Investors who owned stocks in the 2010s generally experienced some big gains. In fact, the SPDR S&P 500's (NYSE: SPY) total return for the decade was 250.5%. But there’s no question some big-name stocks did much better than others along the way.
Nokia’s Difficult Decade: One underperformer of the last decade was telecom and consumer electronics giant Nokia Oyj (NYSE: NOK).
Nokia’s decade was defined by a doomed partnership and ultimately a major strategic pivot away from its legacy smartphone business.
In 2009, Nokia’s global brand value was ranked fifth in the world, according to Interbrand. By 2014, its brand value had plummeted to 98th place.
In 2011, Nokia announced a strategic partnership with Microsoft Corporation (NASDAQ: MSFT) to adopt Windows as its primary smartphone operating system. Afte reporting its first quarterly loss in 19 years in the second quarter of 2011, Nokia launched the Lumina 800, its first Windows Phone, in November 2011.
The Windows Phone was a massive flop, and Nokia simply couldn’t compete with the Apple, Inc. (NASDAQ: AAPL) iPhone. In mid-2013, Nokia sold its entire mobile and devices division to Microsoft.
Nokia shares started the 2010s trading at $13.35 and hit their decade high of $15.89 within months. But high hopes for Windows Phones evaporated quickly. By late 2012, Nokia shares hit their decade low of $1.63 on concerns a potential bankruptcy could be imminent.
Hope was briefly rekindled with the launch of the high-end Lumina 920 in September 2012. But the sale of the hardware division to Microsoft was the biggest catalyst during that period, sending the stock as high as $8.73 by late 2014.
Since that peak, Nokia shares have drifted steadily lower throughout the years. The stock hasn’t traded above $5 since late 2019.
2020 And Beyond: Nokia shares were hammered in early 2020 during the broad market COVID-19 sell-off, and the stock dropped to as low as $2.34, its lowest point since 2012. While the stock has since rebounded to around $4.34 on hopes that a 5G rollout could drive additional upside, Nokia has still delivered underwhelming overall performance over the past 10 years.
In fact, $1,000 worth of Nokia stock in 2010 would be worth about $664 today, assuming reinvested dividends.
Looking ahead, analysts expect Nokia’s rebound from the March low to continue in coming months. The average price target among the 29 analysts covering the stock is $5, suggesting 15.3% upside from current levels.
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