The ratings on Overland Park, Kan.-based Sprint Nextel Corp. reflect a weak business profile because of its elevated churn relative to its peers, anemic subscriber trends, and significant competition from other wireless carriers, which is particularly important as the industry continues to show signs of maturation. It also reflects an aggressive financial profile, including rising leverage and declining discretionary cash flow generation. Mitigating factors include Sprint Nextel's position as the third-largest wireless carrier in the U.S., a strong portfolio of spectrum licenses, and industry-leading data penetration. Sprint Nextel's deteriorating operating and financial performance are the result of several factors, most notably the erosion of its high-margin post-paid subscriber base at a time when its competitors are experiencing healthy, albeit slowing,
