Nextel Communications' bank debt rallied last week as the company came out with promising earnings results. A trade was rumored to be completed as high as 89 1/2, but most traders quoted the paper in the 88 1/2 - 89 range. The paper had begun to inch up the day before earnings were released in anticipation of strong results. "Historically, they've always beat expectations," one dealer said of the early activity.
Nextel reported revenue gains of 26% compared to its third quarter last year and operating cash flow of $878 million, up 67% from last year. In addition, the company added roughly 480,000 subscribers and retired $1.5 billion of its outstanding debt and mandatorily redeemable preferred stock. None of the company's $4.5 billion in bank debt was retired.