Tomahawk, WI 8/07/2013 (Basicsmedia) – Sprint Nextel Corporation (NYSE:S), has been around since 1899 when it was founded with its headquarters currently located at Overland Park, Kansas. The major direct holders in this company include Softbank Corp, Hesse Daniel, Euteneuer Joseph J, Elfman Steven Lawrence, and Johnston Robert L. Its services, which are mostly focused on the wired and wireless communications, are provided to its customers based in the U.S, Puerto Rico and the U.S Virgin Islands as well. But, why is its performance and growth slowing down?

Who Owns Major Stake in S?

Initially, S had been the subject of a major battle pitting Softbank Corp on one hand, and Dish Network on the other. These two major firms were fighting for outright ownership of the company, and eventually Softbank Corp emerged victorious. It is hoped that the deal which brought S and Softbank together is one which is aimed at helping the former grow and achieve success in terms of contending with its major competitors, which include some of the leading giants in the industry wherein it operates. Softbank owns 78% stake in Sprint Corporation.

How Has S Responded to the Deal with Softbank?

Softbank paid more than $21 billion to purchase the 78% stake it owns in S. This was an improved offer from what it had been willing to pay initially, close to $20.1 billion. After the successful completion of the deal which allowed Softbank to own a stake in S, the Sprint Corporation started seeing a drop in its stock price. In the last three months only, the company has seen its stock price dropping by close to 7%, and this is quite high for a company of Sprint’s caliber. The company faces huge challenges as it seeks to attract more customers and make sales.

Sprint Corporation has to contend with the activities of other companies such as Verizon and AT&T, which are considered industry giants. These two companies already carry much influence in the industry, as seen from the fact that they have better share in the market, and continue to attract more customers compared to S. One has to contend with the fact that there is a belief that there is saturation within the wireless industry in the U.S, therefore, any company with a goal of making it big here, must work overtime to offer perfect and most effective solutions to clients.

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This image, courtesy of www.seekingalpha.com, shows number of subscribers for

S compared with its competitors.

S continues to face a very tough battle to gain a much larger share of the market. It has a better outlook on many fronts compared with what its competitors must contend with in the next few months, and years. Therefore, my recommendation to investors would be to wait and see before making up their minds with regard to whether to buy or sell their stock. This seems to be the only option they have at the moment based on what is taking place in the market. It may not have performed as per expectations but it’s still too early to write it off, bearing in mind that Softbank is one of its major shareholders, and has given it tremendous backing financially.

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