Wells Fargo sees that Nokia might not announce a material miss in the September quarter when it announces its results on October 27. Analyst Maynard Um thinks that the company might have witnessed share gains or better trends in China compared to the situation at the start of the current year.
"We forecast Nokia's Mobile Networks revenue will decline 12 percent y/y in Q3 and decline 7 percent y/y in Q4. We believe the broader pressures in the end markets will continue to limit material upside potential to NOK and think restructuring/synergy details will be important. We maintain our Market Perform rating," the brokerage said in a research note.
The firm set a valuation range of $5.30–$6.00 on Nokia shares based on a sum-of-the-parts analysis. Wells Fargo sees risks to shares coming in the form of weaker than expected wireless infrastructure launches, pressure on pricing, merger of Alcatel Lucent SA (ADR) (previously traded ALU) and IP lawsuits.
Wells Fargo comments came on the heels of Ericsson indicating weak trends in the next two or three quarters. The company faced sales pressure in Brazil, Russia, the Middle East and Europe, although there was no material deviation from its plan in North America and China.
At Time Of Writing ...
- Ericsson was down 20.19 percent at $5.59.
- Nokia was down 5.11 percent at $5.11.
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