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Nokia-StarHub Partnership Brings Trial 5G Network in Singapore

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Zacks Equity Research
·4 min read
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Nokia Corporation NOK strengthened its long-standing partnership with StarHub, a leading Singapore-based telecommunications company, by executing Southeast Asia’s first live 5G non-standalone network trial. The development follows StarHub’s recent announcement of selecting Nokia as its 5G technology partner for deploying mmWave solution and 5G Standalone Core network.

Running until Feb 16, 2021, the trial 5G network will likely enable StarHub to provide higher data bandwidth and reliable connectivity to its customers. Importantly, the network utilizes Nokia’s end-to-end core and radio solutions, which enables efficient use of spectrum to deliver 5G services.

In this project, spectrum re-farming was implemented in 900MHz and 2100MHz for the LTE anchor layer and 5G operation, respectively. It includes Nokia’s NetAct, a central network management system, to reduce manual processes while enhancing quality. Also, Nokia’s AirScale baseband was upgraded to evolve StarHub’s network.

StarHub’s customers will be able to experience early benefits of 5G, with enhanced coverage and performance. The operator will gradually expand the network coverage and expects it to reach 70% by September 2020.

Nokia is developing its 5G portfolio, strengthening AirScale and advancing the capabilities of its ReefShark chipset. The company is working with multiple partners to support its ReefShark family of chipsets, which are used in many base station elements. The company’s end-to-end portfolio includes products and services for every part of a network. This helps operators enable key 5G capabilities such as network slicing, distributed cloud and industrial IoT.

Meanwhile, Nokia is making good progress in its Mobile Access business, while improving cash generation. The company aims to accelerate its product roadmaps and cost competitiveness through additional 5G investments in 2020. Nokia is witnessing a healthy momentum in its focus areas of software and enterprise, which augurs well for the licensing business.

The company is positioned to benefit from copper and fiber deployments of passive optical networking. It is the only global supplier committed to Open RAN with commercial 5G Cloud-RAN networks. Also, Nokia expanded its IP routing business into the data center market. Nokia seeks to expand its business into targeted, high-growth and high-margin vertical markets to address opportunities beyond its primary markets. It had announced plans to accelerate strategy execution, sharpen customer focus and reduce long-term costs. This, in turn, is likely to position the company as a global leader in the delivery of end-to-end 5G solutions.

Nokia’s shares have added 21.2% in the past six months compared with 16.9% growth of the industry. The Finland-based telecom equipment provider has a long-term earnings growth expectation of 15.6% compared with the industry’s 15.1%.

Nokia carries a Zacks Rank #2 (Buy), at present.

Some other top-ranked stocks in the broader industry are Advanced Energy Industries, Inc. AEIS, Plantronics, Inc. PLT and Clearfield, Inc. CLFD, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Advanced Energy Industries has a trailing four-quarter earnings surprise of 39.1%, on average.

Plantronics has a trailing four-quarter earnings surprise of 540%, on average. The company’s earnings beat the Zacks Consensus Estimate in three of the last four quarters.

Clearfield has a trailing four-quarter earnings surprise of 45.6%, on average. The company’s earnings topped the consensus estimate in two of the last four quarters.

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