Besides Apple, it seems that HERE is extremely valuable for Google's driverless cars.
google/search: "german car maker might acquire nokia's here maps business"
Copy-paste the following quote from the above search result.
"As mentioned above, it’s reported that the German automobile manufacturers are afraid that with this map business, Google will be able to make a takeover within the auto industry. Because Google uses digital maps for development with self-driving cars, the company could use the business to further create a unique operating system for these self-driving cars. While this would seem harmless enough, Google could potentially give away the operating system for free."
Facebook is currently using HERE for its mobile browsers (though for apps, it is using Google Maps for Android and Apple Maps for iOS).
So, HERE is valuable for Google, Microsoft, Facebook, Apple, Uber and German Car Trio. NOK may have internal offer from other tech giants which is yet to become public. Coming week should be interesting and truly it would be really disappointing to see such a valuable asset go less than 6 Bil (though with HERE internal valuation and current bids, it looks like HERE can stretch only up to 4 Bil).
Sentiment: Strong Buy
I am also thinking along the same lines. I guessed that too long time back.
Search for the following thread on Apr 14, 2015
"Just great! NOK down 6.6%. Suri wants to over pay for all of ALU and make NOK even more of low margin utility company. He will mange .."
and look at my comments. (That time ALU deal details were not announced).
tbadsha, my point precisely was setting right expectations because one can throw any figures such as 8/10/12/15/20 Bil but is there any grounds to back up such outrageous expectations when market news and rumors indicate that buyers are looking to pay around 3-3.5 Bil. Unless there is a news/rumor about someone offering 6/8/10 Bil, I wouldn't have so high expectation because it is like setting yourself for huge disappointment.
When device division went for 7.2B, lot of people screamed about the deal as they wanted NOK to get 13-16B but the deal went thru. As shareholders we are biased and we always want lot more but bid price is more important than ask price.
Here valuation from NOK longs/shareholders : 8B (from Navteq) + 2-3B(spent on here from last 2-3 years) + 3-4B(Here patents) = 12-15B
Here valuation from outside buyers : 3-3.5B
Lets see how it plays out and what HERE is finally sold for.
(sorry tbadsha for not replying to your thread as it is sometimes difficult to find nested thread)
I would be as happy as you if NOK gets 8B+ for HERE but it looks very optimistic. NOK itself is not looking aggressive about HERE pricing and seems that NOK is contented to get anywhere between 3B and 4B euros. (Read articles on Reuters and Bloomberg which says "NOK is looking to get 3B for HERE). As NOK longs, we can throw any figure like 8B, 10B or 12B but that would be far from reality as all bid figures are around 3B.
NOK devices division was lot more worth than 7B 12 years ago but NOK got only 7B for device division sale. Similarly no matter what NOK paid to Navteq before, the important question is, what is HERE worth today as the value of asset increase/decrease over time and whether asset is a liability for the company?
All articles we have been reading from last 2-3 weeks talks about HERE likely to be sold around 3B. I would read that as NOK management not outrightly rejecting the figure as too low and might be even considering selling HERE for slightly above 3B euros. Uber = 3B$ and German Auto = 3B euros. So, I am expecting HERE to get anywhere between 3B and 3.5B euros and if we are lucky and someone is very desperate then even 4B euros. But anything above that is being too optimistic.
Having said that Suri is very shrewd CEO. The way he acquired ALU without affecting NOK cash reserves is amazing. So, he may cut out another interesting deal such as getting 3B euros but still own part of HERE or license HERE for 3-5 years and get 500 mil license fee every year (just throwing some possibilities).
My 2 cents ....
Sentiment: Strong Buy
Thanks Wesley. I googled and found this article after your response.
Urban, the significant price jump or drop after reporting results by any company makes me suspicious that there is some manipulation involved at least when results are reported or major announcements are made (good or bad). Any significant news that would move PPS in either direction, the needle is moved a lot more than it should by so called 'manipulators'. How can one explain 20% PPS drop in MSFT in last quarter, 15% PPS jump in MSFT this quarter, 12% PPS drop in Ericson, 12% PPS drop in NOK? Even if results are in-line or slightly off mark, MMs find a way to drive PPS significantly in one direction or the other.
Having said that I personally do not agree to "rinse and repeat" infinite cycle created by manipulators. NOK was swinging between $7.50 and $8.30 from last 8 months but so is Ford, BAC, Ericson and large number of other stocks. Different stocks have different window and they swing between that small window for years. NOK swung between 7.50 and 8.30 because after MSFT paid 7.2 B there was no significant news in NOK which would break and move its PPS beyond 8.50 and keep it stable there.
Urban, you may be right and there may be manipulation involved in keeping NOK restricted between 7.50 and 8.30 to make money multiple times/repeatedly both ways but then what is so special about 7.50-8.30 range. Why don't they drop it below 7.50 and push it above 8.30 to make even more money? Why F, BAC and many other billion dollar company swings between 15 and 16 dollars for years? Is MMs manipulation involved for every stock?
This stock market is very complicated but I feel that triggers are pulled at significant events but it is hard to believe that they are being pulled all the time. (Just my theory)
There is no ground for panic but results is the best time for market makers and traders to make huge money by causing big swing in one direction or the other. These manipulators keep huge call and put options (BOTH)and as long as there is a huge movement up or down, they make lots of money. I may be wrong in my theory but this is one possibility. Hence when NOK reported average Q1 quarter they ensured to move it down by almost a dollar thus making lots of money thru PUT options despite covering losses for CALL options they bought at the same time with PUT options.
I remember MSFT going down from $49 to $40 in the previous quarter on reporting slightly weak outlook. In this quarter MSFT jumped from $42 to $49 on beating the expectations. The point is when big giants like MSFT does not have immunity and can be dropped almost 20% on weaker outlook, what is NOK in comparison to that.
With current market sentiment, I would give NOK a window from $5.50 to $8.50 with a base of $7 at least until the next quarter results. It means that NOK can go down to $5.50 with poor ALU results and currency fluctuation (worst case) and go up to $8.50 with HERE and Sammy News (best case). Few weeks later with all news settling down, it will gradually move towards $7 and swing between $6.75 and $7.50.
So far I do not have any complaints from NOK management because this drop is not caused by them but caused by MMs and inside traders. Companies like MSFT, Facebook, Apple, Google also report negative results once a year, so how can we expect NOK to report huge profitable results every quarter.
I know most of us are deep in the water including me because this kind of fall was totally unexpected as it happened almost after a year. But I am positive that NOK will swing back to mid 7's soon and we just have to be patient.
My 2 cents ......
Bruno/tbadsha, there are mixed emotions on ALU earnings. Many think that even ALU earnings will be disappointing because of weak seasonal sales which affected NOK and Ericson. Also the capex budget cut in North America for year 2015 is likely to affect ALU numbers.
Any reason why you think the other way round ? I never followed ALU. Did they mention something in their previous report outlook ?
I was hoping for NOK to move towards $7 today but disappointed again. I am not trying to create panic here but next week is also not looking good to me and NOK may go down towards $6 (16 cents drop due to dividend on May 5 and approx. 25-35 cents down due to ALU results on May 7). That's the worst I am expecting by end of next week. After that NOK should rebound slowly from $6 towards $7. It is highly unlikely that NOK would drop below $5.90 unless dollar becomes lot more stronger or market goes down by more than 300 points (everything coming together on the same day). I am being pessimistic about NOK at least for a week but time is against NOK. Feel free to contradict my theory and I'll be happy as I am also under water with this dip.
Agree that Networks results were disappointing but overall numbers were in-line (in fact better)and NOK did not deserve to take a hit of more than 12%.
Earnings whisper also has ALU = -0.02 because the figure is contained in " ( ) " which means negative. Type NOK and it says $0.05 without brackets.
Today is a bad day for NOK longs and some of you are also talking about NOK dropping further on ALU reports next week. There is no news about HERE buyer. So, the only ray of hope is Sammy arbitration.
Anybody knows when is this coming ? Can I expect to hear in next 2-3 months or the wait could be even longer ?
Urban, are you sure Sammy arbitration will be announced later May ? Was there a news/rumor about it ?
Unfortunately my fear was not baseless. Frankfurt indeed is not liking it and quite obviously because of decline in network operating profit. Again long wait for NOK longs to see NOK back in 8. Very disappointing .
I hope investors also look at this earnings with the same mindset as yours. In most of the previous earnings, EPS was mostly driven by nokia networks with very little contribution from HERE and nokia tech. Hence sometimes I feel that investors has this perception that success of NOKIA as a company is hugely driven by success of nokia networks and networks only. If they analyze the report with this mindset, then they might consider this earnings as failure.
I would have been more relieved if the figure for nokia networks and nokia tech for operating profit were reversed.
Not sure how market is going to react to 61% YOY decline in Non-IFRS profit for nokia networks. We got this EPS due to nokia tech and not because of nokia networks.
Timothy Bryan (Seeking Alpha author) is expecting Q1 EPS = $0.08- $0.09 . Good article but again no one has the exact numbers.
Also may be it is good that analyst is expecting less from NOK so that NOK has greater chance of beating estimates and stock should go north. If estimate had been $0.12- $0.15 and NOK reporting $0.09 then stock would have gone south.
Sentiment: Strong Buy
Wall Street Journal and Earnings Whisper are predicting EPS = $0.05 for Q1. In previous quarter, EPS was $0.09.
Why is the expectation this low ? Is it because NOK mentioned in its previous report's outlook that Network sales is likely to decline seasonally this quarter. Are you guys also expecting EPS to be this low ?
I know nobody has the numbers but please share your thoughts and throw your guesses about Q1 EPS with basic reasoning as why you expect NOK EPS to be higher or lower or same as analyst estimate of $0.05.
Sentiment: Strong Buy
Bang on. This is what I have been consistently repeating in most of my threads that HERE deal is a mystery and HERE sell and ALU Buyout at the same time is not a coincidence. NOK is riding on HERE offer to buy ALU.
Most of us have no expertise of running a million/billion dollar business but still we understand the best options for NOK is to sell HERE and buy only ALU wireless. If we have this basics, definitely Suri and board also knows it. What is difficult for us to understand as what is compelling NOK to buy whole ALU ? Hope that information comes out soon and then things will start falling in place.
Agree whole of HERE proceeds going towards purchasing full ALU is not a deal but at least it will keep NOK where it is now (high $7's) but if HERE sell does not materialize and NOK buys full ALU, NOK PPS will fall significantly.
I still feel that HERE has a major role to play and that's why NOK dared to think about buying full ALU (when ALU may not have agreed to give just the wireless). I strongly feel that NOK already has a buyer for HERE and NOK should be getting 10-12Billion plus for HERE and so NOK feels OK to buy full ALU. Without HERE proceeds, the numbers just don't add up.