United States Cellular Corporation (NYSE:S) is offering a free iPhone 7 to those who switch to its network from rival carriers in a bid to attract new customers.
According to this latest promotional plan, consumers who trade in as many as four qualifying smart phones can get Apple Inc’s (NASDAQ:AAPL) latest model as well as unlimited data on the phones for as little as $40 per month. Qualifying smart phones include iPhone 5s, Samsung (KS:005930) Galaxy S6, or better.
The cost of the iPhone7 offered will be covered by the company through 30 monthly bill credits of $18.28. Existing customers, who upgrade to any new iPhone will get a $100 United States Cellular promo card to buy accessories. Meanwhile, those purchasing a 9.7-inch iPad Pro will save $200 off the tablet. This lucrative offer from the company is sure to attract more consumers.
This offer from United States Cellular is a retort to the Sprint Corporation’s (NYSE:S) offer of unlimited data, for a year, to users who switch as many as five lines from its bigger rivals. T-Mobile US, Inc (NYSE:S) is also participating in this competition, offering customers a second Galaxy 8 free when they buy the first at full price.
Unlimited Data Plan War
In Feb 2017, Sprint upgraded its unlimited data plan. Now new customers can buy a single line on it’s unlimited plan for $50 and two to five lines for $90, per month. Any extra line will cost $40 each. These rates will remain effective till Mar 31, 2018. After that, the company will raise the prices back to normal rates, per which, one line will costs $60 a month, two lines will cost $100 and every line beyond that will cost an additional $30.
The plan will also offer high-definition (HD) video streaming and 10 GB of LTE mobile-hotspot data per month for new subscribers. However, to enjoy HD video streaming on an unlimited plan, subscribers may have to pay a separate $75 per month. We observe that Sprint’s offer is cheaper when compared with the unlimited plans of other U.S. wireless carriers such as AT&T (NYSE:T), T-Mobile US and Verizon communications.
T-Mobile US’ unlimited plan starts at $70 per month for a single line, while two lines are available for $100 a month. Verizon offers a single line of unlimited data for $80 a month with a second line for $60. AT&T's unlimited plan starts at $100 a month, but it doesn’t include monthly taxes and fees, consequently raising the final cost. Notably, Verizon and AT&T do not include those fees in their advertised rates, either. However, T-Mobile US does.
United States Cellular’sPrice Performance:
United States Cellular is the sixth-largest wireless telecom operator in the U.S. in terms of customer count; with 4.93 million subscribers spanning across five geographic markets that cover 23 states. Over the past three months, share price of United States Cellular inched up 4.40 % while the Zacks-classified Wireless National industry declined 7.08 %. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
We consider the above points to be the reasons behind United States Cellular currently carrying Zacks rank #3 (Hold).
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