Investing to Wealth

Clearwire Corporation (NASDAQ: CLWR)

Clearwire Corporation (CLWR) builds and operates wireless broadband networks that enable Internet communications. Its wireless broadband networks cover entire communities and deliver a high-speed Internet connection that not only creates a new communications path into the home or office, but also provides a broadband connection anytime and anywhere within its coverage area. It offers services in both domestic and international markets. The Company’s services consist primarily of providing wireless broadband connectivity, but in some of its domestic markets, it also offers voice-over Internet protocol (VoIP) telephony services. As of December 31, 2008, The Company operated its networks in 51 markets in the United States and Europe covering approximately 18.2 million people, and as of December 31, 2008, it had approximately 475,000 wireless broadband subscribers. The Company’s networks in the United States were deployed in 47 markets and covered an estimated 15.3 million people.

The Company was formerly known as WiMAX Operations of Sprint Nextel Corporation and changed its name to Clearwire Corporation. Clearwire Corporation is headquartered in Kirkland, Washington. It operates as a subsidiary of Sprint HoldCo LLC.

Source: Reuters.com, SEC Filings.

Financial Summary

• New $1.564 Billion Equity Financing Round Announced; High Yield Bond Offer Launches Today to Replace and Expand Existing Credit Facility; Total Equity and Debt Commitments of $1.8 Billion from Existing Investors In Place
• 4G Network Coverage Increases by 67% to Over 10 Million People with 4G Mobile Internet Service Launched in 11 More Markets During Third Quarter
• Selling in 24 WiMAX Markets in November; On Track to Launch Seattle, Honolulu and Maui Covering More Than 30 Million People by Year End 2009
• Fry’s Electronics and MicroCenter Added as National Indirect Sales Distribution Outlets for CLEAR Products and Services
• Wholesale Partners Including Sprint, Comcast, and Time Warner Cable to Expand Selling Efforts Across 4G Markets
• CLEAR 4G WiMAX Markets Generate Strong Net Subscriber Additions of 49,000 and Consolidated Net Adds Top 44,000 for Q3 2009
• Revenues Increase 13 Percent Driven by 18% Subscriber Growth
• Total Network Covered POPs Increase 40% to 25.4 Million
• Cash and Short Term Investments of $2.0 Billion and Nationwide Spectrum Holdings of Over 43 Billion MHz POPs

Source: Reuters.com, SEC Filings.

Analyst Consensus

This is the consensus forecast amongst 12 polled investment analysts. Against the Clearwire Corp company.

The six analysts offering 12-month price targets for CLWR have a median target of 6.00, with a high estimate of 12.00 and a low estimate of 3.00. The median estimate represents a -2.60% decrease from the last price of 6.16.

Source: www.ft.com

Source: http://www.reuters.com/finance/stocks/estimates?symbol=CLWR.O

Investment Highlights

CLWR announced last week that it has executed a definitive agreement to raise $1.564 billion in new investment capital from Sprint Nextel Corporation, Comcast Corporation, Time Warner Cable Inc., Intel Corp.n, Eagle River Holdings LLC and Bright House Networks LLC in exchange for newly issued shares priced at $7.33 per share. Participants in the new round of equity financing include Sprint Nextel for $1.176 billion, Comcast for $196 million, Time Warner Cable for $103 million, Intel for $50 million, Eagle River for $20 million and Bright House Networks for $19 million. Closing of the equity financing is subject to certain closing conditions, including, with respect to a portion of the financing, the lapsing of the time period required under applicable law for the effectiveness of the stockholder written consent approving the transactions, which has been executed. CLWR will receive approximately $1.057 billion in cash from the equity financing within five business days, $440 million in cash will be funded at a closing which is targeted to be completed by year end 2009, and the remaining $66 million will be funded at a closing which is targeted to be completed during first quarter 2010.

CLWR earlier this month announced the expansion of its sales operations for CLEAR’s super fast mobile Internet service throughout the Philadelphia region. The Company also named Andrew Kupiec as general manager for the Philadelphia market. With CLEAR, consumers and businesses can access the Internet wirelessly, at true broadband speeds - at home, in the office, and on the go anywhere in the CLEAR coverage area. CLEAR covers 1000 square miles and approximately 3.6 million people in the Philadelphia market. Regionally, service extends as far north as Bucks County, south to the Delaware state line below the Philadelphia airport, east to Cherry Hill, N.J., and west to the Phoenixville and Malvern areas.

Source: http://www.clearwire.com/

Technical Analysis

CLWR is below its 50-day moving average. This bearish sign is even more significant because the moving average is also trending lower.

CLWR has been relatively stable recently. This is evidenced by the width of its Bollinger Bands which are tighter than normal. Additionally, CLWR is trading near its lower Bollinger Band. This suggests that the stock price is low relative to its recent price action.

The MACD for CLWR currently indicates a strong bearish signal for two reasons. First, the MACD is below the signal line, a 9-day moving average. Second, the MACD is below the critical level of 0, which implies that the underlying moving averages are trending lower.

Comparative Analysis

Source: Thomson Financial

Insider Trading Activity

Source: Yahoo Finance

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