Double Whammy for Sprint Stock

2:15 PM -- Ooof!

Sprint Corp. (NYSE: S)'s stock price is taking a sound thrashing in the market, probably largely on the back of nasty second-quarter results.

In afternoon trading Thursday, Sprint's stock was down $0.83 -- over 16 percent -- at $4.32. It closed at $5.16 on Wednesday night. (See Sprint Confirms LightSquared Deal, Losses Grow.)

Evidently investors aren't impressed with the idea that Sprint will eventually save money on Long Term Evolution (LTE) service through its massive new spectrum-sharing deal with LightSquared . (See Sprint's $13.5B Jump to LTE With LightSquared.)

That's not so surprising: LightSquared's future is still up in the air because of the GPS L-Band interference issue. Sprint CEO Dan Hesse admitted on the second-quarter call that he couldn't turn the LTE network on until this had been resolved. (See LightSquared Claims It Has Answer to GPS Problem.)

LightSquared will also need more money to pay Sprint its $13.5 billion over time. This might be less of a problem if the GPS problem is solved, however, and LightSquared can go ahead with customers like Sprint. Then raising future funds might not be so hard.

Of course, the deal could have a sting in the tail for LightSquared as well: Will some of the operators it has been rumored to be talking to -- like MetroPCS Inc. (NYSE: PCS) -- want to do business with a wholesale partner that is running on a competitor's network?

— Dan Jones, Site Editor, Light Reading Mobile

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