If you were wondering why Sprint shares are currently down more than six-percent on the day, it likely relates to Bernstein analyst Craig Moffett, who expects shares of Sprint to underperform based on “new and larger risks.” One of those new risks could be a faster, LTE-capable iPhone that is rumored to launch as early as this Fall.
Debt-ridden Sprint currently lags quite far behind its two main competitors, AT&T and Verizon, in terms of deploying a high-speed LTE network across the United States. Should Apple launch an iPhone with LTE connectivity in the near future, Sprint would surely feel the effects of not offering a nationwide “Long Term Evolution” network. And the risk could be enough for Sprint to spiral into bankruptcy…
“To be clear, we are not predicting a Sprint bankruptcy. We are merely acknowledging that it is a very legitimate risk. And notwithstanding a recent rally in Sprint shares, we believe that risk is rising,” Moffett said in a research note.
It’s unlikely that Sprint will declare bankruptcy anytime soon, but the fears that Moffett is instilling into the carrier’s investors surely isn’t helping the cause. Sprint announced last November that it would be rolling out network improvements for increased iPhone speeds and moved nearly 2 million iPhones in the most recent fiscal quarter. Sprint joined AT&T and Verizon as an official iPhone carrier alongside the launch of the iPhone 4S in October 2011.