MetroPCS up, analyst calls pullback ‘overdone’

NEW YORK — Shares of MetroPCS Communications Inc. climbed Tuesday after a UBS analyst said the low-cost wireless carrier’s shares have been oversold.

Analyst John C. Hodulik reiterated a “Buy” rating on MetroPCS, which sells prepaid wireless plans with no required contract. On Tuesday, the stock rose 48 cents, or 4.1 percent, to $12.25 in afternoon trading, though it is still down nearly more than 17 percent year-to-date, hurt by investor worries over competition.

“MetroPCS shares have come under severe pressure after Tracfone’s launch of a Straight Talk unlimited $45 plan using the (Verizon Wireless) network,” the analyst wrote in a note to investors. MetroPCS, he noted, also sells service through Wal-Mart at a similar price to Straight Talk. But this makes up less than 5 percent of Metro’s gross customer additions, so the Tracfone service likely won’t eat too much into the company’s business.

Shares of Leap Wireless International Inc., a MetroPCS competitor, rose 51 cents, or 4.3 percent, to $12.28. The stock is up about 5.5 year-to-date.