AT&T, Sprint and Verizon Eyeing This Spectrum
Telcos AT&T (NYSE:T), Sprint (NYSE:S) and Verizon (NYSE:VZ) are licking their chops at the prospect of acquiring sorely needed spectrum as U.S. House and Senate members agreed to authorize the sale or auction of wireless spectrum yesterday. The move to sell a national resource would realize significant advantages, the most important being a huge boost to employment and technological development. “By freeing up airwaves to be used to build the next generation wireless networks, this package will support massive job creation and untold technological breakthroughs,” Representative Fred Upton, a Michigan Republican who heads the Energy and Commerce Committee, said in an e-mailed statement.
Another big payoff to government coffers would be an inflow of about $15 billion, sorely needed to balance revenues lost due to a payroll tax cut. A long outstanding recommendation, arising from 9/11, for the creation of a national network for emergency workers, would see the light of day through this mechanism. “This agreement will allow us to build a nationwide, interoperable communications network that is as reliable as the first responders that protect us,” Senator Jay Rockefeller said in an e- mailed statement. “It will quite literally save lives.”
Lastly, the auctions will help satisfy “Americans’ voracious appetite for mobile Internet,” Steve Largent, president of CTIA-The Wireless Association, a trade group, said in an e-mailed statement yesterday.
Grumbling comes from TV station owners who may have to switch airwaves due to the reallocation of recovered spectrum, and bear additional costs. Another not-so-happy party – the FCC – as the legislation may substantially clip its wings regarding allocation and auction of wireless spectrum. “Congress has recognized the vital importance of freeing up more spectrum for mobile broadband, both licensed and unlicensed, although the legislation could limit the FCC’s ability to maximize the amount and benefits of recovered spectrum,” FCC Chairman Genachowski said in an e-mailed statement.
Here’s how these major telecom stocks are reacting to the news:
AT&T, Inc. (NYSE:T): T shares recently traded at $30.03, up $0.01, or 0.03%. They have traded in a 52-week range of $27.27 to $31.94. Volume today was 10,298,733 shares versus a 3-month average volume of 26,096,200 shares. The company’s trailing P/E is 45.53, while trailing earnings are $0.66 per share.
Sprint Nextel Corp. (NYSE:S): S shares recently traded at $2.27, up $0.01, or 0.44%. They have traded in a 52-week range of $2.10 to $6.45. Volume today was 6,344,220 shares versus a 3-month average volume of 39,268,400 shares. The company’s trailing earnings are $-0.96 per share.
Verizon Communications Inc. (NYSE:VZ): VZ shares recently traded at $38.38, up $0.33, or 0.87%. They have traded in a 52-week range of $32.28 to $40.48. Volume today was 4,167,045 shares versus a 3-month average volume of 13,746,800 shares. The company’s trailing P/E is 45.13, while trailing earnings are $0.85 per share.
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