Shenandoah would be ‘biggest winner’ in wireless merger
After CNBC’s David Faber reported that T-Mobile (TMUS) and Sprint (S) are in “active” talks about a possible merger, Drexel Hamilton analyst Barry Sine called Shenandoah Telecommunications (SHEN) potentially the “biggest winner” if such a deal comes to pass.
Shenandoah Telecommunications Company, also known as Shentel, provides regulated and unregulated telecommunications services to end-user customers and other telecommunications providers in Virginia, West Virginia, central Pennsylvania, western Maryland, and portions of Kentucky and Ohio. It offers a suite of voice, video, and data communications services. The company operates in three segments: Wireless, Cable, and Wireline.
If T-Mobile bought Sprint, it would have to decide whether to acquire Shenandoah at fair market value, shut down its network and retail stores in Shentel’s area within two years or to sell the T-Mobile customers and network to Shentel at a discount, which #Sine sees as the option the company would most likely choose given its integration challenges.
Note that insiders have recently been buying shares of Shenandoah. There have been multiple insider buys in recent weeks, all at or below $36.
The analyst, who foresees significant acceleration in Shenandoah’s results in coming quarters even without a Sprint merger deal, keeps a Buy rating on the shares, which are up 3.1% to $36.75 in Tuesday’s trading. The stock (SHEN) has a 52-weeks trading range of $22.05 – $37.90.
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