The ratings on Overland Park, Kan.-based wireless carrier Sprint Nextel Corp. reflect an aggressive financial risk profile characterized by its elevated leverage of about 4.8x debt to EBITDA and uncertainty related to future funding plans for majority-owned Clearwire Corp. The ratings also reflect weak profitability measures relative to its peer group; significant competition from other wireless carriers, which is particularly important as the industry continues to show signs of maturation; and elevated—albeit improving—customer churn rates. Mitigating factors include Sprint Nextel's position as the third-largest wireless carrier in the U.S., improving post-paid subscriber trends, a strong portfolio of spectrum licenses, and industry-leading data penetration. Sprint Nextel's operating performance has improved over the past few quarters because of growth on the CDMA
