NEW YORK-Owing to what it described as industry risk and price appreciation, brokerage firm Bear, Stearns & Co. has downgraded the high-yield wireless telecom and towers sector to “underweight,” promising to revisit the sector early next year.
“In the short term, we believe industry risk has increased because of more intense price competition brought on by the slowdown in customer growth,” wrote Sandy Liang, high-yield telecom and tower analyst at Bears, Stearns. “However, in the long term, we believe major opportunities, such as unleveraged free cash-flow growth and potential consolidation, will improve the sectors’ outlook.”
