The company then poured huge dollars into those networks so that they could support voice and data service. They say nothing will change because they will have contractual relationships with one another. But once they re independent, contracts can wither away. Employees want to see the results of their efforts reflected in the value of their company, he argued. Individual business units may receive a higher valuation as spinoff companies than as tracking stocks, says McBride.
Some people just don t like tracking stocks.
They re artificial and don t convey any real ownership. Sprint s wireless tracking stock certainly does not seem to reflect its full value. If it were a tracking stock, shareholders owning the tracking stock wouldn t get the premium. If someone takes a company over, the premium typically goes to the main stock. The challenge, he says, is that carriers have realized that they can t make money in the future on voice, and they can t make money in the future on anything else.