Calling All Nokia Experts!
What's up with Nokia's stock price? Is this a case of too much expectation? I've never really followed telecom closely but this has popped up on my radar as being cheap.
Low P/E 9.5 compared to its historical 5 year average low P/E of 10, and 5 year average high P/E of 18.
EV/EBIDTA of 7 for the trailing twelve months. And price to sales of 1.3. Their margins, ROE, and debt levels (near zero!) are solid compared to other cell phone makers.
Its chart from 2001 to 2006 is sideways with some ups and downs. By most measures, it seems like a cheap growth stock. It's dividend yield is around 2.7% (also historically high) and their dividend growth rate has averaged 13% yearly.
What I do know is that they're a low cost producer; they own the emerging markets (hat tip Ed); people in the developed world will still need replacement phones and people in the emerging markets need cheap phones.
Looks safer than cash! Dial me up!
posted by Des @ 4/18/2008 11:10:00 PM
1 Comments:
Sadly, I mis-timed this one and got in at $32 much to my chagrin. The reverse of our US Multi theme is happening to NOK. They had high costs in Euros while most of their goods were sold and priced in US$ terms, even in emerging markets. They also gave flat guidance for 2008 because of the weakening US$. I don't see anything wrong with their business model, as mgmt has been executing on expanding market share so if/when the US$ slide ends, this stock is going straight up.
Having said all that, I think Mr. Market has overreacted since NOK always gives conservative guidance, so this could be a buy opportunity. At least the club will have $3 on me :)
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