Subject: [NEXTEL-1] For a Day, Wireless Finds a Bid.html

From: Marcel <[email-masked]>
Date: Thu, 24 Oct 2002 14:44:49 -0400

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Tech Stocks : Kenneth Li

For a Day, Wireless Finds a Bid

By Kenneth Li
Senior Writer

10/24/2002 01:02 PM EDT

Click here for more stories by Kenneth Li

Updated from 8:43 a.m. EDT
Wireless carrier shares soared in morning trading, swept up in the euphoria of new business at Nextel
(NXTL:Nasdaq - news - commentary - research - analysis) and AT&T Wireless
(AWE:NYSE - news - commentary - research - analysis).
For a moment, concerns that saturated markets would make it impossible for wireless carriers to pay their enormous debts took a back seat to consecutive reports that showed improving subscriber growth. Shares of AT&T Wireless jumped $1.16, or 21.3% to $6.61. Nextel's stock gained 76 cents, or 7.5% to $10.96. Triton PCS
(TPC:NYSE - news - commentary - research - analysis), an AT&T affiliate, saw its shares gain 84 cents, or 45.7% to $2.68.

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Even Sprint PCS
(PCS:NYSE - news - commentary - research - analysis), which reported a net loss in subscribers last week, saw its shares leap 65 cents, or 21.2% to $3.72.
"Investors are looking for reasons to buy rather than sell these stocks after two years of wandering in the darkness," said Thomas Wiesel Partners telecom analyst Ned Zachar.
Nextel turned in its second consecutive quarter of positive earnings Thursday, driven by strong operational improvements, tight cost controls and new markets for its walkie-talkie-style phones and services. And perhaps more significantly, it reported adding almost half a million new subscribers in the quarter.
The nation's fifth-largest wireless carrier handily beat analyst consensus earnings estimates and reported revenue surging 26%, largely at the expense of competing carriers.
The company posted net income of $526 million, or 58 cents a share, on revenue of $2.27 billion, compared with a loss of $209 million, or 27 cents a share, on revenue of $1.8 billion last year. The latest quarter includes a gain from the retirement of debt and preferred stock; excluding that, it earned $128 million, or 14 cents share, 10 cents better than the First Call consensus. The revenue number beat the analysts forecast by about $10 million.
Attraction to Nextel's walkie-talkie-style service features helped it gather another 480,000 new net additional subscribers, ahead of its own predictions of 475,000. Churn, or the rate at which customers leave the service, also slipped lower to an industrywide low of 2%, from 2.1% last year.

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