Wall Street responded negatively to the NTELOS’s spectrum sale, sending the stock down 45.1 percent on Dec. 2. Wells Fargo Securities dropped its target price for the NTELOS stock to $7-$9 from $14-$15. However, Wells Fargo analyst Jennifer Fritzsche wrote that Wall Street may have reacted too harshly to the spectrum sale, because it came as a surprise and may have been negotiated from a position of weakness. The actual narrative of the company may be more positive, according to Fritzsche.
“In our view, this strategic shift should allow NTLS to re-focus on its more profitable Western markets, where it has a stronger competitive position. While the role of a regional wireless provider is becoming increasingly hard, NTLS’s Strategic Network Alliance agreement with Sprint should help mitigate some of the typical pressure points of the revenue model,” she wrote.