Brightpoint North America L.P, an operating arm of a leading
distributor of wireless devices,
), recently announced the renewal of its contract with
MetroPCS Communications, Inc.
) owned MetroPCS Wireless, Inc.
As per the deal, Brightpoint will provide logistic assistance to
MetroPCS-owned store, agents and its retail partners all across the
U.S. Brightpoint is expected to provide services like receiving of
orders from customers and proper delivery of the ordered goods.
Additionally, the company will also offer storage as well as
customer credit facilities to MetroPCS Wireless customers.
Brightpoint already has a solid supply-chain agreement with
large mobile handset developers such as
Research In Motion Ltd.
), and HTC Corp., Such relationships will further strengthen its
network and deliver improved services to its clients.
Recently, Brightpoint is witnessing various challenges as the
company reduced its financial forecast for fiscal 2012. This is the
second time that the company has lowered its 2012 financial
guidance, which was provided at the end of 2011. We believe that
loss of a major client in the company's high-margin Logistics
segment in the U.S is one of the prime reasons for such defensive
guidance. Moreover,global economic volatility and weaker margins on
product sales coupled with the recent trend of consolidation among
telecom carriers may act as negative catalysts for the company in
the long term. We, thus, maintain our long-term Underperform
recommendation on Brightpoint Inc.
Currently, Brightpoint Inc. has a Zacks #5 Rank, implying
a short-term Strong Sell rating on the stock.
Brightpoint Inc. is a leader in global distribution of wireless
devices and the provision of customized logistic services to
wireless equipment manufacturers and carriers.
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