Nokia Upgraded Amidst Troubling Times

ABG Sundal Collier announced today that it has upgraded struggling cellular company Nokia (NYSE: NOK) from Hold to Buy on the basis that shares are trading down and the firm expects a 30 percent asymmetric upside to its $3.14 price target. Following thousands of job cuts, a managerial overhaul and plans to reorganize the business, the company's June 14th announcement shook already unsure investors and analysts to the core, with many research firms noting depleted faith in Nokia. However, not everyone saw the tough call to be as devastating as one would think.Oppenheimer upgraded the telecommunications company to Perform on the day Nokia lowered its second quarter outlook last week. With Microsoft's (NASDAQ: MSFT) Windows 8 launch looming, the firm thought it best to set risks aside for the moment and concentrate on what's to come. While it is not Microsoft that can be credited for today's upgrade, ABG Sundal Collier believes the initial reactions of those who were quick to criticize Nokia for its restructuring efforts jumped the gun. As a result of the job cuts and lowered estimates, costs will be brought down to a minimum level while the company works to find its footing amongst the popular and highly competitive smartphone market. "Nokia's radical moves on restructuring detailed last week – wrongly interpreted, in our view, as a ‘profit warning' of recent kinds – should be applauded rather than criticised. Given the circumstances in which it now operates, management now takes the necessary, painful action to prepare itself for a long war of attrition vis-à-vis the Android camp," ABG Sundal Collier said in its morning report. The research firm proceeded to lay out three elements, including restructuring measures, asset disposals and the near-term launch of Windows 8 smartphones and tablets, as the basis from which the current equity case revolves around. While much of the future is up in the air, Nokia certainly has a few positive business developments in the works that have softened the blow the company has faced as of late. Only time will tell what direction Nokia is headed in next, but the company does have a few fans left that will stick around to find out. NOK is currently trading around $2.50, down ~50% year-to-date, while MSFT is currently trading at almost $30.00, up ~15% year-to-date.