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Shentel / Sprint LTE - (was ntelos - West & N&W Virginia)


marioc21

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The T-Mobile sale could be for trading spectrum with Sprint. I do not know Sprint's unused spectrum holdings.

 

Looking at the financials, this seems to be rushed or premeditated.  There is no reserve for restructuring costs.  CAP-ex is assumed to continue at the same levels.  They lost more than 10% of their eastern customers during the last year while gaining more than 10% in their western markets.

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Stock down more than 60%

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This website, http://markets.financialcontent.com/prnews/quote?Symbol=NTLS, gives a misleading picture.  Bloomberg is more accurate, http://www.bloomberg.com/quote/NTLS:US, which puts the loss at about 40%.

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A year ago the stock price was $21.40, now approx $4.40

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A year ago the stock price was $21.40, now approx $4.40

 

Slowly recovering a bit, but as Robert has mentioned the lower the better for Sprint. Although, I bet my friends on Wall Street are starting to digest this information and are frantically putting models together for a Sprint buyout. Oh the joys of legalized gambling finance. :)

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Here is what I took away from the Q&A in the conference call:

 

- They were getting beat in the east by Boost and Metro

- Required too much capital for more sites and spectrum in east plus too much eastern competion

- The issue list for the west is much more doable and they have less competition

- Intend to have 50% of western towers with LTE by end of 2015

- They have 115 towers total which they hope to sell and lease back [i assume only in the west]  Less than 1/2 are wooden poles.

- They said the spectrum they sold was for 3G thus had less value, same with market

- They said they have 27Mhz of their own spectrum in the west plus from Sprint: 20Mhz of PCS, 2.5 (unknown) plus 12Mhz of 800.  They intent to use the 800 for longer range and building penetration.

 

They also used the term "Another Strategic Partner" around the time they were discussing spectrum sales.

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I wonder where they will place their moved LTE towers.  Perhaps the non-wholesale areas of their map where they are competing with Shentel (Winchester and Hagerstown) or Sprint (Parkersburg, Gallipolis).  I would think they would want to get out of these areas too, but perhaps too much roaming costs would result for them. [edit: To maximize roaming revenue, I would expect new fully Sprint compatible towers to go into areas marked wholesale on their map - http://ir.ntelos.com/Cache/1001192642.PDF?Y=&O=PDF&D=&FID=1001192642&T=&IID=4110676 - page 5]

 

In the future, if they are not bought out, they could also move into remote areas of southwest Ohio where Sprint is not, such as McArthur, McConnelsville/Malta, Waterford/Beverly, New Lexington, Cadiz, Woodsfield.

Edited by dkyeager
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I wonder where they will place their moved LTE towers.  Perhaps the non-wholesale areas of their map where they are competing with Shentel (Winchester and Hagerstown) or Sprint (Parkersburg, Gallipolis).  I would think they would want to get out of these areas too, but perhaps too much roaming costs would result for them. [edit: To maximize roaming revenue, I would expect new fully Sprint compatible towers to go into areas marked wholesale on their map - http://ir.ntelos.com/Cache/1001192642.PDF?Y=&O=PDF&D=&FID=1001192642&T=&IID=4110676 - page 5]

 

In the future, if they are not bought out, they could also move into remote areas of southwest Ohio where Sprint is not, such as McArthur, McConnelsville/Malta, Waterford/Beverly, New Lexington, Cadiz, Woodsfield.

I would not think that you will see any expansion of nTelos into Ohio or anyplace else.  They are not into an expansion mode at all.

If I were the CEO, I would be looking at dropping the nTelos brand, selling off the spectrum, moving the current customers to Sprint, converting the nTelos stores to Sprint Stores.  Follow the Shentel model.  It sure has worked for Shentel.

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Honestly, this is a head scratcher.  Why T-Mobile?  Why not Sprint?  Per my spreadsheets, both Richmond and Norfolk are PCS A-F block 20 MHz markets, which have little flexibility in spectrum refarming for additional LTE carriers.  Only $56 million would have been chump change for Sprint to shore up its spectrum situation in the Tidewater region.

 

AJ

Which PCS block does nTelos currently own in Norfolk?

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This really sucks for western VA customers too.  At least for now..... we have been promised all year that 70% of ntelosland would have 4g by the end of 2014.... Now it will be 50% with 4g by the end of 2015?????? Thats just ridiculous... 

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Which PCS block does nTelos currently own in Norfolk?

Nevermind... It looks like they own the lower 2/3rds of the B block (with the rest owned by Verizon).

 

It is a disaggregated portion of the former PrimeCo PCS license for the Richmond-Norfolk MTA.  Because of the spectrum cap at the time, VZW could not retain the entire license.

 

AJ

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It is a disaggregated portion of the former PrimeCo PCS license for the Richmond-Norfolk MTA.  Because of the spectrum cap at the time, VZW could not retain the entire license.

 

AJ

 

PrimeCo! My first cell phone company. 

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Stock seems to have stabilized at $4.55 today.

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It is a disaggregated portion of the former PrimeCo PCS license for the Richmond-Norfolk MTA.  Because of the spectrum cap at the time, VZW could not retain the entire license.

 

AJ

BTW, in this area, Verizon owns the entire cellular band since the Alltel merger. That seems patently uncompetative to me.

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Honestly, this is a head scratcher. Why T-Mobile? Why not Sprint? Per my spreadsheets, both Richmond and Norfolk are PCS A-F block 20 MHz markets, which have little flexibility in spectrum refarming for additional LTE carriers. Only $56 million would have been chump change for Sprint to shore up its spectrum situation in the Tidewater region.

 

AJ

Won't be the first time Sprint ignored this market. Hampton Roads/Tidewater was also the largest metro area on the Eastern Seaboard where WiMax was never launched.

Edited by GoWireless
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Won't be the first time Sprint ignored this market. Hampton Roads/Tidewater was also the largest metro area on the Eastern Seaboard where WiMax was never launched.

 

Be clear -- pun intended.  That was Clearwire, not Sprint.

 

AJ

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