Wachovia Capital Markets downgraded Sprint Nextel Corp to market perform from outperform, citing higher churn at the company's iDen customer segment in the first quarter, sending its shares down 9 percent.
Sprint has struggled to integrate the iDen wireless network, which it bought through its acquisition of Nextel in 2005.
Despite the rollout of new iDen price plans, we believe churn on the legacy iDen user has been higher than expected and iDen gross add growth has been difficult, analyst Jennifer Fritzsche said in a note to clients.
The analyst raised her first-quarter churn estimate to 2.3 percent from 2.1 percent.
Last October, Sprint announced plans to retain its customer-losing iDen network after efforts to sell it failed.
Shares of the Overland Park, Kansas-based company were trading down 33 cents at $3.81 on the New York Stock Exchange. They have lost about 31 percent of their value in the last one year.
(Reporting by Mansi Dutta in Bangalore; Editing by Anne Pallivathuckal, Anil D'Silva)