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S&P Equity Research Picks PCS Focus Stock of the Week
Monday, June 06, 2011
NEW YORK, June 6, 2011 /PRNewswire/ -- MetroPCS (NYSE: PCS: $18) has been picked by Standard & Poor's Equity Research as its Focus Stock of the Week. PCS carries S&P's highest investment recommendation of 5-STARS, or Strong Buy.
"We believe PCS's subscriber market share gains in 2010 were driven by its Wireless for All pricing strategy launched in January 2010 that includes all taxes and fees as well as unlimited , nationwide voice, text and data for as little as $40 a month," said James Moorman, Wireless Telecommunications Equity Analyst at Standard & Poor's Equity Research. "In addition, PCS was one of the first prepaid carriers that offered smartphones, which, coupled with low-price, unlimited plans, proved to be an attractive combination during the smartphone surge in a difficult economy. Further pricing innovation occurred in late 2010 with the company's MetroUSA, or national plans, and new Long Term Evolution pricing was introduced in January 2011. We believe this chain of innovation will continue in 2011 and help to drive continued growth in subscribers and average revenue per user."
Moorman believes PCS's competitive pricing plans should allow it to take advantage of uncertainty at T-Mobile, which is awaiting approval for its planned takeover by AT&T (NYSE: T 31 Buy). He says T-Mobile has typically offered lower-priced wireless plans, and he thinks uncertainty from the pending merger could allow PCS leverage to convert subscribers to PCS's network. Moorman observes that if the merger is approved, AT&T could be required to sell certain markets or spectrum, allowing PCS or other carriers to enhance their respective networks.
To view a video of Mr. Moorman discussing PCS, paste the following link into your browser.
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