UPDATE: Macquarie Upgrades Sprint on Entry Point Created by Recent Share Weakness

In a report published Wednesday, Macquarie analyst Kevin Smithen upgraded the rating on Sprint Corporation (NYSE: S) from Neutral to Outperform, and raised the price target from $7.00 to $7.50.

In the report, Macquarie Capital noted, “In our opinion, recent weakness in Sprint shares due to concerns over a weak Q3 and Q4 and potential 2014 EBITDA guidedown have created an entry point in what we believe is the most compelling 3-5 year story in large cap US telecom. Given the limited liquidity in S shares post tender, we are prepared to be a few months early in order to not miss what could be a rapid 20-30% next year. Larger investors should take advantage of any increased volatility and liquidity around the Q3 print to aggressively build positions ahead of what we think will be improving newsflow and postpaid sub trends over the next few qtrs. At the end of the day, we believe that spectrum quantity wins and in Son-San‟s vision and track record of execution. Now that the market has a more realistic view of the timing and costs of Network Vision as well as the sub and EBITDA ramp for S, we think the stock has been significantly de-risked since the closing of the SoftBank deal.”

Sprint Corporation closed on Tuesday at $6.03.