Sprint Corp (NYSE:S) just released preliminary fiscal second-quarter results including robust postpaid phone net adds coupled with postpaid phone churn at a historic record low. This comes on the heels of the mobile network giant’s spectrum-backed multi-billion dollar notes offering.

However, Nomura analyst Jeff Kvaal remains sidelined on the company, noting that though revenue growth is “relatively strong,” it’s Sprint’s EBITDA that “invites questions.”

Though S posted fiscal second-quarter revenue of $8.25 billion, which topped both Kvaal’s projection of $8.1 billion and the Street’s forecast of $8 billion, the company’s adjusted EBITDA of $2.35 billion fell “in line” with Kvaal’s estimates but under consensus of $2.45 billion. Meanwhile, Sprint’s EBITDA margin of 28.4% underperformed the analyst’s forecast of 29% and the Street’s 30%.

In reaction, the analyst reiterates a Neutral rating on S with a price target of $6.00, which represents just under a 13% increase from where the shares last closed.

Kvaal opines, “We await more detail when Sprint reports next Tuesday morning but are somewhat surprised at the miss given the strength of the iPhone 7 leasing promo as well as Sprint’s significant progress to date on achieving $2bn in annualized savings exiting FY16.”

From the analyst’s perspective, “capex remains the gating issue,” adding, “We remain concerned given that so much of Sprint’s turnaround is predicated on network quality.” Sprint’s total capex of $828 million underperformed the analyst’s expectation of $1.5 billion and consensus of $1.1 billion.

Regarding “lingering” concerns circling the company’s liquidity, Kvaal explains, “We believe Sprint’s $15bn in available liquidity plus our estimate of an additional $5bn in pending liquidity is sufficient to meet its debt maturities and financial obligations through fiscal 2018.”

Ultimately, “Network underinvestment could derail improving fundamentals,” Kvaal concludes.

According to TipRanks, which measures analysts’ and bloggers’ success rate based on how their calls perform, five-star analyst Jeff Kvaal is ranked #319 out of 4,180 analysts. Kvaal has a 62% success rate and yields 11.5% in his yearly returns. When recommending S, Kvaal earns 0.0% in average profits on the stock.

TipRanks analytics demonstrate S as a Hold. Based on 15 analysts polled in the last 3 months, 3 rate a Buy on S, 9 maintain a Hold, while 3 issue a Sell. The consensus price target stands at $5.91, marking a nearly 14% downside from where the stock is currently trading.