Why NTELOS Holdings Corp. Shares Skyrocketed Today

Is NTELOS' jump meaningful or just another movement?

May 22, 2014 at 2:05PM

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of NTELOS Holdings Corp. (NASDAQ:NTLS) jumped nearly 19% Thursday after the Virginia-based wireless carrier announced it has extended its strategic network alliance with Sprint (NYSE:S) through 2022.

So what: Under the amended agreement, nTelos will continue serving as the exclusive network provider for Sprint for roughly 2.1 million customers in West Virginia and the western part of Virginia. Sprint customers will also gain access to nTelos' new 4G LTE network, and nTelos will enjoy access to Sprint's 800 MHz, 1.9 GHz, and 2.5 GHz wireless spectrums in the territory. Finally, nTelos says the deal "builds on initiatives announced in March by Sprint [...] that seek to accelerate the deployment of 4G LTE coverage throughout underserved American communities. 

Now what: This eliminates significant uncertainty surrounding nTelos' relationship with Sprint, and obviously bodes well for its long-term survival in the face of ever-increasing competition in the wireless space. 

But as a result, note nTelos is also eliminating its dividend following the already-declared July 2014 payment, which will free up roughly $36 million per year to invest in its network and growth initiatives. In the follow-up conference call, management elaborated it makes sense to invest in the business rather than paying a dividend, especially considering the dividend was "really a holdover from our consolidated sell Co case prior to the spin-off of our wireline business 2.5 years ago."

In addition, thanks primarily to accounting changes relating to deferred revenue in the new agreement, nTelos lowered guidance for 2014 adjusted earnings before interest, taxes, depreciation, and amortization to be between $128 million and $135 million. By comparison, two weeks ago nTelos saw 2014 adjusted EBITDA between $140 million and $150 million. In the end, I just can't get excited about nTelos despite the new agreement, so I'm fine watching this one from the sidelines.

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A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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