Sprint Nextel set to report Tuesday

Sprint Nextel Corporation (NYSE:S) shares have recovered 43% in the last month and the Street is looking for more good news come Tuesday. Now Sprint is teaming up with Clearwire (CLWR) and merger rumors with Deutsche Telekom have picked up interest again this week.  So Masters, how to play the earnings call, walk away or run to it?

What Wall Street cares about on this call is the turnaround plan, it's that simple. The quarter could be horrible, guidance fair, but if the Street hears what it wants about Sprint getting it's act together, that could be enough to push shares up another 5%.

Hard to believe but Sprint Nextel is still the third-largest wireless carrier and should a spin-off or sale of Nextel to Germany's Deutsche Telekom would mean big gains for shareholders.

More from Chron.com --

In January, three top executives _ Chief Financial Officer Paul Saleh, Chief Marketing Officer Tim Kelly and Mark Angelino, the president of sales and distribution _ left the company abruptly. Sprint has since named Robert H. Brust CFO.

Earlier in January, Sprint said it would lay off about 4,000 employees and close 125 retail locations due to a steep drop in its customer base. Sprint had said it expects to lose 1.2 million postpaid subscribers in the first quarter and a similar amount in the second quarter. Postpaid subscribers are more valuable because they usually spend more on data services, like text messaging and Web surfing.

BY THE NUMBERS: Analysts, on average, are expecting a profit of 2 cents per share on sales of $9.41 billion, according to a poll by Thomson Financial.

ANALYST TAKE: Banc of America Securities analyst David W. Barden, who rates Sprint "Neutral," will be looking for "any positive variance emerging on subscriber, ARPU and churn trends" in the company's earnings report. ARPU, or average revenue per user, is a closely watched industry figure for how much revenue the company makes per customer in a month. Churn is subscriber turnover.

WHAT'S AHEAD: On Wednesday, Sprint and Clearwire announced they have resurrected a plan to offer high-speed Internet service, with the help of outside investors including Google, Intel and Comcast.

Sprint and Clearwire plan to combine their wireless broadband units to create a $14.55 billion communications company, to be called Clearwire but with Sprint owning a majority stake, that will continue developing a mobile network based on WiMax technology. WiMax is similar to the WiFi technology used in airports and coffee shops, but covers much larger areas and promises faster speeds.

STOCK PERFORMANCE: Shares of Overland Park, Kan.-based Sprint tumbled 49 percent during the quarter to close at $6.69 at the end of March. The stock has gained since, and was recently trading at $9.45.

Masters, there's plenty to be excited about going into the call and this could finally be the time that we see a decent gain for shareholders after an earnings call.   Now shares of Sprint stand at $9, miles away from that 52-week high of $23.