Brightpoint North America L.P, an operating arm of a leading
distributor of wireless devices,
), recently announced that it has renewed its contract with Sprint
United Management Company, a subsidiary of
Sprint Nextel Corp.
Therefore, Brightpoint will continue to provide logistics
assistance to Sprint's different groups of prepaid retail service
providers like Boost Mobile, Virgin Mobile and Assurance Wireless
brands. Other services under the contract include the receiving of
orders from customers and proper delivery of the ordered goods.
Additionally, Brightpoint will also offer warehousing and customer
credit facilities to different customer groups.
However, Brightpoint is currently witnessing various challenges,
which has induced the company to reduce 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.
The loss of a major client in the company's high-margin Logistics
segment in the U.S is the reason for the weakness. 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
Currently, Brightpoint Inc. has a Zacks #5 Rank, implying a
short-term Strong Sell rating on the stock.
Brightpoint Inc. is a leader in the global distribution of
wireless devices and the provision of customized logistic services
to mobile network operators, mobile virtual network operators
(MVNO), resellers, retailers and wireless equipment
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