Last week, Sprint
In this video, Fool.com analyst Eric Bleeker talks about Sprint's efforts to stem the tide. While Sprint did report its best customer quarter in some time, it also comes at a time when both Verizon
However, Bleeker is still weary of Sprint as a long-term investment. The company's acquisition of Nextel is a textbook case of acquisitions gone awry. Incompatible technologies led to extremely high integration costs, and Sprint struggled to get Nextel under its wings. Likewise, while partner Clearwire
Bleeker is afraid of that kind of deal. While those in favor of the deal might point to added scale to compete with AT&T and Verizon, network incompatibility will once again create headaches. Not that there's opportunity lacking from such an arrangement if done right, but Bleeker fears the two desperate operators might make an arrangement that further destroys value for Sprint shareholders.
Sprint has valuable assets, no doubt, but the company also has a high debt load and is desperate to make moves in the mobile marketplace. As the company keeps looking at splashy ways to stem the tide of Verizon and AT&T's growth, there's more of a chance its lofty cash flows will be wasted on acquisitions or mergers. Bleeker understands the value proposition with Sprint, but until its future plans with LTE are settled, he's staying away.
To hear Bleeker's full thoughts on the subject, view the video below:
Eric Bleeker owns shares of no companies listed above. Sprint Nextel is a Motley Fool Inside Value pick. Try any of our Foolish newsletters today, free for 30 days. The Motley Fool has a disclosure policy.