Sprint Gains as Arora’s SoftBank Exit Seen Brightening Outlookby
SoftBank CEO Son more committed to Sprint long-term: Macquarie
Sprint shares rise to seven-month high in Wednesday trading
Sprint Corp. rose to a seven-month high as investors speculated that the wireless carrier would get more investment from parent company SoftBank Group Corp. after a key management change.
Former SoftBank heir apparent Nikesh Arora, whose departure was announced this week, had “expressed no clear-cut plan for Sprint during his tenure,” Macquarie Group Ltd. analyst Amy Yong said Wednesday in a note. With Arora leaving, Chief Executive Officer Masayoshi Son is committing to running the company for longer than he originally planned. Son has a more long-term vision for the U.S. wireless company, Yong said.
“We feel reassured by the positive market reaction this afternoon that Mr. Arora’s resignation could usher in a new mindset and investing attitude towards Sprint,” said Yong, who advises buying Sprint shares.
Buried under $33 billion in debt, Sprint has struggled to make investments to compete with larger rivals such as AT&T Inc. and Verizon Communications Inc. The company has slashed network spending to the lowest level since 2010 and is putting up phones, equipment and airwaves as collateral in loan deals brokered by SoftBank.
Sprint rose as much as 7.5 percent to $4.47 Wednesday, its third straight day of gains.