Analysts Play Tug of War With Leap Wireless

Leap’s stock has come down over 14 percent since the end of last week. Shares dropped nearly 7 percent alone on Thursday following another analyst note, this time from Jefferies. The analyst there cut his rating on the stock from “Hold” to “Underperform,” and lowered his price target from $6 to $5, for the exact opposite reason the analyst from Guggenheim made his call.

“In our view, Leap is not a ‘must-have’ asset in the ongoing industry consolidation,” wrote the analyst. There are just two major markets, Houston and Phoenix, where Leap’s spectrum fills an area under served by T-Mobile’s current service. For the same reasons the analyst thoroughly discounts any interest by Sprint (NYSE:S), leaving the company high and dry.

The analyst’s bearish note was echoed by Jim Cramer, who also doesn’t think a takeover is happening any time soon. Nearly every analyst who covers the stock has a “Hold” rating, and the average price target is $6.70. The company is expected to report a fourth-quarter loss of $1.61 per share on February 15.

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