Leap Wireless Shares Plunged: What You Need to Know


Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Investors in Leap Wireless International (NAS: LEAP) leapt out of shares as fast as possible, sending shares 19% lower after a competitor released terrible earnings.

So what: MetroPCS (NYS: PCS) caused the ruckus today when it reported weak earnings and sent its own shares tumbling 30%. Low-cost wireless providers are being hit with higher costs and lower growth than expected this year.

Now what: This is just another indication of how our fragmented recovery is affecting the country. The low end of the market is struggling far more than high-end customers, and wireless providers like MetroPCS and Leap Wireless are taking it on the chin. Leap Wireless is expected to report yet another loss this year, so if you're bargain shopping, MetroPCS would be a better pick, but I would still be wary of the space right now.

Interested in more info on Leap Wireless? Add it to your watchlist.

At the time thisarticle was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2011 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Originally published