US Cellular Launches HTC Smartphone - Analyst Blog
July 05 2012 - 01:54PM
Zacks
United States Cellular Corporation (USM), has
announced the launch of HTC One V, and thus became the second
telecom carrier in the U.S. to offer the smartphone. We believe
this is an attempt by the company to diversify its smartphone
portfolio. The HTC One V will be available online and the company’s
own store.
The smartphone is strategically priced at $129.99 dollar with a
$100 mail-in-rebate and is $70 less than what rival
Sprint-Nextel
Corp.’s (S) prepaid division
Virgin Mobile is offering. Benefits include features like new
devices being offered without the hassles of re-signing the
contract and a point based reward system which is the first of its
kind in this industry. However, a new customer will have to sign a
two-year contract and have to pay the activation fees.
HTC One V is one of the few phones in US Cellular’s stable that
runs on Google Inc.’s (GOOG) new android
(Ice-Cream Sandwich) platform.
The phone is launched to keep pace with the increasing demand
for newer versions of smartphones. Additionally, the phone will
target customers who want to stick to a single device for a
considerable span of time. Although the company is slated to launch
the very popular Samsung SIII for its high-end customers, we
believe that this phone will attract customers who are looking for
a good smartphone at a decent price
tag.
The current Zacks Consensus Estimate for United Cellular is
pegged at 69 cents for the second quarter with a growth rate
estimate of (10.13%). For 2012 and 2013, the Zacks Consensus
Estimates stands at $2.04 and $1.78 with growth rate of (1.29%) and
(12.89%), respectively.
Recommendation:
We maintain our long-term Neutral recommendation for United
States Cellular Corporation. Currently, USM has a Zacks #3 Rank,
implying a short-term Hold rating on the stock.
GOOGLE INC-CL A (GOOG): Free Stock Analysis Report
SPRINT NEXTEL (S): Free Stock Analysis Report
US CELLULAR (USM): Free Stock Analysis Report
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