Actually we must put things into perspective. Bbry shareholders may get $4.7b, but that is it, there is now absolutely no opportunity for them to recover if they had bought at higher prices , it is the end of the bbry story.
On the other hand, Nokia sold a money losing part of their business for $7b, got a great calibration as to how much their patents should be worth , which of course can be use against the many mobile gadgets makers all around the world in this up coming era of licensing litigation, and of course we get to keep Here and NSN, the most profitable mobile infrastructure company . In other words, shareholder of Nokia has a fair chance of one day reaping back all their returns even had they bought at a high price. I do think personally for those of us who bought at 2s, we are looking at a 10 bagger here in a couple of years.
Think that Nokia had a future when massive stars like Apple and giant Google (yes Google) found themselves slowly being suffocated by this monster black hole called Samsung ?
Well, another great star has just been gobbled up, blackberry, go ahead, take a look at the latest report. What Elop said two years ago is 100 % coming true ! Black berry sales did not just collapsed. It has reported a figure, 50% down from the already collapsed figures expected from a collapsed business, that confirmed extinction !
Thanks to Elop leadership, we have much to celebrate today.
Have we Nokian saw what happened to Brry in the last trading hour yesterday. GO ahead take a good look. You will be thankful for what Elop did for Nokia.
That is my point exactly, Elop did not turned around Nokia because the competition is too tough. A lot of people mistakenly think going Android will turn around Nokia, I seriously think it will not, otherwise there would have been parties after parties at HTC. On the other hand, going any other way and you could ended up like BlackBerry. This is a Samsung world, where even Google and Apple is having serious problems.
I would first politely ask the honorable minister to look at BlackBerry. I think he, like others is coming from the angle that Nokia did not exactly turned around. While he is right, I still do think that Elop still did play a huge part in saving Nokia.
IMHO, few appreciated how far Nokia was behind the race and had Nokia gone Android, and if our phones don't make money, there will be no Msft to still pay us billions for what some analysts already called a failed business, just ask HTC. I do not think MSFT will buy HTC business, on the other hand HTC and every single Andorids mainstream makes will never ever be able to outrun Samsung, even Google can't do it.
So I guess there was a serious understanding of the real trouble Nokia was in.
Excellent news , In other words, based on profit and market cap alone, relative to current Ericsson market cap, Nokia should be worth well north of 60b, or share price trading around $15 .
Of course Ericsson does not have Here, its patents are a lot less, and they certainly do have have cash Nokia has.
First question answer is no. They are just purchasing the devices division. The price is about 5.4 b, plus they further license the right to use Nokia technology, aka patents for the price of another 2b.
The answer to your second question will be Here maps, patents which they can licence to other smartphone makers like HTC. and NSN, that is they become Ericsson main competitor overnight. Of course they will suddenly also possess lots of cash.
If you believe in the future success of Lumia line of phones, then yes Msft is the place you should goto. Hope that helps, to other new investors with similar questions as well.
That should take Nokia to around Ericsson valuation. That should not be a problem as Nokia is a lot more powerful in patents, holds a lot more cash and has even in its poccession Here.
Beyond that though I would like to see how analyst view Nokia new lines of business. My take is in the long run Nokia would have no problem trending to $25 as it still has 90 % of patents unliecnced out, if I am not mistaken. JPM is already calling for teens and others are catch up fast..
Most of the longs here initiated their positions at 2s at most 3. So during that time, one may say one is looking at 350 % to 500 % gain when Nokia trend towards $10, a target to which we are now seeing a very likely one before any major correction sets in. However as a fellow small investor in would say that going in right now you mya just be looking at 50 % gain. Not to sound discouraging but you have to see if you wish to diversify as well even if you wish to participate in the rest of the Nokia run. As for the insittutions, they are coming in from a different angle because Nokia has just returned to investment grade, hence the large pension funds buying as part of their so called 'core holdings' .
Hint : In seems that in that Nokia world discussed ,
1. Patents do not exist , and only those to microsoft exist. This even we all know Nokia is really a patent powerhouse. Microsoft already got theirs ? That's it, no more. that is all Nokia has.
2. Nokia massive new cash position does not matter. It mattered a lot to Moody, Fitch, S and P but it seems it does not really matter to seeking alpha .
3. That Nokia having sold is hamorrageing Device division is still the same old Nokia, no change. So it does not matter when one bleed badly and one does not. You have got a bad cut and bleeding badly ? nah no worries, you do not need to stop the bleed, you will still remain healthy no matter what, just let the bad bleeding continue.
Nok has now gone up, it is barely two weeks since Microsoft made that announcement.
Now you know the surge has yet to run its couse. This will almost reach, no exceed $10 by Christmas. You know it. But notice the urge inside you, you want to sell, you badly want to , you are fearful if you don't , Nokia will fall. Yes you are afraid of losing a couple of dollars while ignoring the lost opportunity to make a thousand. You are getting impatient. You have a very strong urge to do somthing.
It is thus time to stand back and study yourself, your brain, this is called investment psycology, how a rising price, though yet to reach its academic peak, and something you know yourself, could seriously make you do something you know later on when the price reach $10 , you will only live to regret. This is exactly what makes Warren Buffet and Peter Lynch different from the rest of us. They are aware of what they are doing, they are in control, instead of letting the price movement of the stock control them, and their feelings. Understand this powerful profound force inside you caused by a rising stock.
I do not know where on Earth are you going to find another stock like that, never mind NYSE, take any and every stock market on this planet, are you able to find another stock like Nok whoever every analyst is calling a buy. So once again, small investors like us who bought a 2s, please do not sell.
If you only know how those giant are just simply waiting for their accumulation to complete before coming in with those massive upgrades. Notice increasingly they are talking closer and closer to $10. Just you wait, when we arrive near $10, they will say $15. Giant institutions I mean not just those firms but pension funds as reported who literally has the ability to unilaterally soak up everything. Especially when every analyst is calling a buy. Ask yourself, are you able to name a single stock where every, I mean every analyst is calling for a buy? Nok is now a one in 10000 stock globally. So please, do not sell.
I just love it when they said even 6 Euro price target may prove conservative over time. Indeed Forbes even mentioned Nokia has so much control over the entire 4G LTE patents that it is simply mind boggling.
Well I assume since Apple seem to be ready to spend its massive cash on mapping solution after they were terrifyingly embarrassed , they were ready to acquire this piece of what I would call their one stop solution to all their mapping problems.
That said, I got a strange feeling inside me that Nokia actually wanted to sell of Here as well except that Msft was unable to pay the price Nokia was asking for. Nokia certainly wanted at least 7b to cover Nav acquisition cost for sure. But I think Microsoft is not ready to commit 15b. They do have cash, but it would still blow a big hole . To me Apple position is somewhat better off since they got two times more cash to begin with and yet they do not need to spend any further money on devices .
“Windows Phones powered Nokia Lumias device have achieved a striking growth in their volumes within a very short time since their launch in India. With new Windows Phone devices getting launched at short interval, we expect them to continue on this growth trajectory,” said Manasi Yadav, Senior Market Analyst, Client Devices, IDC India.
We no longer own 520, it is truly taking the world by storm. We already conquered Indonesia, Asean, India, and now for sure, given the heavy price of the new cheap iphone, which incidently horrifically expensive , 520 is bound to create a storm in China mid range as well. Well, we did fought a great fight my friends.
That is one big difference between Google acquisition of MOT vs Msft licensing of Nok. One is acquisition, which ultimately meant ownership. The other is just licensing. So even though MSFT is paying a lot less than Google, they did not pay to own it. That said, Nok is far more valuable than MOT patents. To buy the whole thing, some estimate it may cost north of $50b if it is fully monitized.
Thanks . That is a good article.
Nokia has a virtual lock on the 4G LTE. Theirs is in fact the most important ones of all. As you know the cycle for 4G LTE has just began. So yes I would not be surprise Nok true value is way about $15.