Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!

Margin Expansion, Conservative Guidance Justify Nokia Upgrade, Says BofA Analyst

Courtesy of Benzinga.

Margin Expansion, Conservative Guidance Justify Nokia Upgrade, Says BofA Analyst

After the recent market sell-off, investors are looking around for attractive values to buy on the dip — and one analyst said Nokia Oyj (ADR) (NYSE: NOK) is one of those deals.

The Analyst

Bank of America analyst Tal Liani upgraded Nokia from Neutral to Buy and raised the price target from the U.S. dollar equivalent of $5.60 to $6.53.

The Thesis

The recent jump in Nokia shares following fourth-quarter earnings was just the beginning of what the stock is capable of in 2018, given its opportunity to expand its operating margins from 10 percent to 14 percent by 2020, Liani said in a Monday note. 

Nokia’s guidance is also on the conservative side, leaving plenty of room for upside surprise, the analyst said. 

“Nokia’s market guidance of negative 2-4-percent may prove overly pessimistic versus Ericsson’s [negative 2 percent], especially given [that] Nokia’s broad wireline portfolio brings more stability.” 

An IP routing product cycle will likely begin in the second half of 2018, and cost-cutting after the Alcatel deal could help Nokia exceed operating margin guidance, Liani said. In 2017, Nokia nearly tripled its targeted cost-cutting goals.

Finally, Liani is optimistic 5G rollouts will help improve the capex environment throughout 2018. 

Nokia’s diversification following the Alcatel-Lucent acquisition gives the company a unique positioning in the market, and cost synergies, upcoming product cycles and an improving market all make the stock a compelling value at its current price, Liani said. 

Price Action

Nokia stock was up 0.37 percent at the time of publication Monday afternoon.

Related Links:

Texting Turns 25: A Look At Its Transformative Role In US Commerce

Analysis: Government 5G Network Unlikely, Despite Reports

Photo courtesy of Nokia. 

Latest Ratings for NOK

Date Firm Action From To
Feb 2018 Bank of America Upgrades Neutral Buy
Feb 2018 MKM Partners Upgrades Neutral Buy
Jan 2018 Goldman Sachs Downgrades Buy Neutral

View More Analyst Ratings for NOK


View the Latest Analyst Ratings

Posted-In: Bank of America Tal Liani wirelessAnalyst Color Upgrades Price Target Analyst Ratings Best of Benzinga


Do you know someone who would benefit from this information? We can send your friend a strictly confidential, one-time email telling them about this information. Your privacy and your friend's privacy is your business... no spam! Click here and tell a friend!





You must be logged in to make a comment.
You can sign up for a membership or get a FREE Daily News membership or log in

Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!