Articles for Nokia

Nokia’s Profit Margins Expected to Head South

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Tuesday, September 7th, 2010 by Trefis Team

Nokia’s (NYSE:NOK) EBIT margins from mobile phones have consistently declined since 2007 in developed as well as emerging markets. Nokia’s stock is very sensitive to the EBIT margins in the company’s mobile phone business, given that mobile phones account for almost three-fourth of Nokia’s stock value.

Nokia competes with mobile phone makers Research in Motion (NASDAQ:RIMM), Apple (NASDAQ:AAPL), Motorola (NYSE:MOT), and Google (NASDAQ:GOOG). We currently have a Trefis price estimate of around $12.33 for Nokia’s stock, about 29% above the current market price of around around $9.55.

Below are charts showing historical and future trends for Nokia’s profit margins from mobile phones.

Smartphones Could Boost Nokia’s Short-Term Price Structure

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Friday, September 3rd, 2010 by Trefis Team

Nokia (NYSE:NOK) has suffered dramatic mobile phone pricing declines over the last few years, especially in emerging markets. Nokia competes mainly with Apple (NASDAQ:AAPL), Motorola (NYSE:MOT) and Research in Motion (NASDAQ:RIMM) in the mobile phone market.

One positive sign for Nokia is the growing proportion of higher-priced smartphones in its product mix. Over the next two years we expect smartphone sales to provide temporary support to Nokia’s price structure. However, we expect the company’s average phone price to decline after 2012 as smartphone prices drop. Our analysis follows below. Read More »

Potential 8% Hit to Qualcomm’s Stock from Intel-Infineon Deal

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Thursday, September 2nd, 2010 by Trefis Team

Mobile chipset manufacturer Qualcomm (NASDAQ:QCOM) faces a new challenge from mighty Intel (NASDAQ:INTC), which recently expanded its mobile processor capacity by acquiring cellular baseband supplier Infineon for $1.4 billion in cash. Qualcomm also competes with Broadcom (NASDAQ:BRCM), Freescale, Marvell (NASDAQ:MRVL), MediaTek and Texas Instruments (NYSE:TXN).

Cellular basebands are chipsets that handle voice and data communication in wireless devices. Infineon’s customers include Apple (NASDAQ:AAPL) and other mobile phone manufacturers.

We don’t see Intel posing a significant threat to Qualcomm in the short term. However, there could be an 8% downside to our $48 stock price estimate for Qualcomm if Intel manages to snatch a significant share of the mobile chipset market by the end of the Trefis forecast period. Our analysis follows below.

BlackBerry Torch Won’t Help RIM’s Stock

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Thursday, September 2nd, 2010 by Trefis Team

The people have spoken, and Research in Motion’s ballyhooed BlackBerry Torch smartphone is officially…not an instant hit. RIM (NASDAQ:RIMM) only sold 150,000 Torches during the first weekend after the phone’s August 12 launch. By contrast, Apple (NASDAQ:AAPL) moved 1.7 million iPhone 4 units during the first three days after its launch in late June.

RIM competes mainly with Apple, Motorola (NYSE:MOT) and Nokia (NYSE:NOK) in the mobile phone market. The company had high hopes for the Torch, which is the first BlackBerry equipped with both a physical keyboard and a touch screen interface, and the first smartphone to run BlackBerry’s new OS6 operating system.

However, it does not appear that these new features are enough to make the Torch stand out in an increasingly crowded smartphone market. RIM can’t afford to release many more phones like this one. There could be a significant downside to our $72 stock price estimate for RIM if the company’s share of the smartphone market grows more slowly than we expect during the Trefis forecast period. Our analysis follows below. Read More »

Wireless Infrastructure Business Could Lift Nokia Stock by 5%

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Tuesday, August 31st, 2010 by Trefis Team

Nokia (NYSE:NOK) recently purchased most of Motorola’s (NYSE:MOT) wireless network infrastructure division for $1.2 billion in cash. This transaction is expected to close by the end of 2010.

The deal should help Nokia gain business from existing Motorola customers like Sprint Nextel (NYSE:S) in the U.S. and KDDI in Japan.It also raises Nokia’s profile in the gigantic U.S. telecom market, which could help it sell more mobile phones to U.S. customers. Our analysis follows below.

Apple’s R&D Costs Expected to Rise

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Monday, August 30th, 2010 by Trefis Team

Apple’s (NASDAQ:AAPL) stock is sensitive to R&D as % of Gross Profit. Apple is recognized globally for its uniquely designed devices (iPhone, iPod Touch, Apple TV, iPad) and such devices have led to rising R&D costs for Apple. R&D expenses increased from around $0.6 billion in 2005 to $1.4 billion in 2009. Such increases are putting the pressure on Apple competitors such as Research in Motion (NASDAQ:RIMM), Motorola (NYSE:MOT), Nokia (NYSE:NOK), and Google (NASDAQ:GOOG) to keep up.

However, Apple’s R&D costs as a percent of gross profit have declined as a result of the Apple’s rapidly increasing revenues and gross profits. We currently have a Trefis price estimate of $337 for Apple’s stock, about 35% above the current market price of $250. Below we highlight expectations for Apple’s R&D costs in the future.

Better App Selection Could Boost Nokia Stock by 5%

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Monday, August 30th, 2010 by Trefis Team

Finnish mobile phone giant Nokia (NYSE:NOK) recently acquired the mobile Web analytic service Motally for an undisclosed sum. Nokia competes with Apple (NASDAQ:AAPL), Research in Motion (NASDAQ:RIMM) and Motorola (NYSE:MOT) in the mobile phone market.

Motally sells analytic software that helps mobile application developers track application usage statistics on mobile phones. We believe this acquisition will draw more mobile app developers to Nokia’s platform. This should help Nokia improve its online app store and thereby help the company sell more phones. Our analysis follows below. Read More »

Nexus One Smartphone Less Than 1% of Google’s Stock

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Thursday, August 26th, 2010 by Trefis Team

Google (NASDAQ:GOOG) recently stopped selling Nexus One smartphones through its U.S. online store. In the smartphone market, Google competes primarily with Apple (NASDAQ:AAPL), Research in Motion (NASDAQ:RIMM) and Motorola (NYSE:MOT).

Google launched the Nexus One to great fanfare last January. Going forward, Nexus One phones will still be available in U.S. retail stores and internationally through partners like Vodafone.

We expect Google to sell only around one million Nexus Ones worldwide in 2010. This implies that the smartphone business now constitutes less than 1% of the $683 Trefis price estimate for Google’s stock. Our analysis follows below. … To read the full article Subscribe to Trefis Pro

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Potential 5% Downside to Motorola from Slightly Higher R&D Costs

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Tuesday, August 24th, 2010 by Trefis Team

Motorola’s (NYSE:MOT) stock is quite sensitive to R&D as % of Gross Profit. Over the last week, Trefis members have created forecasts for Motorola’s R&D as % of Gross Profit and their projections suggest higher R&D expenses that could result in 5% downside to stock.

Motorola competes with Research in Motion (NASDAQ:RIMM), Apple (NASDAQ:AAPL), Nokia (NYSE:NOK), and Google (NASDAQ:GOOG) in the mobile phone market. We currently have a Trefis price estimate of around $8 for Motorola’s stock, about 12% above the current market price of around $7.

Below is the chart showing recent estimates created by Trefis members for the one driver in detail.

Smaller Decline in Mobile Chipset Share Could Boost Qualcomm’s Stock

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Monday, August 23rd, 2010 by Trefis Team

Qualcomm’s (NASDAQ:QCOM) stock is quite sensitive to (1) CDMA Mobile Phone Chipset Pricing and (2) Qualcomm CDMA Chipset Market Share. The Trefis member forecasts suggest that CDMA Mobile Phone Chipset Pricing will be in-line with the estimates of the in-house team of analysts at Trefis, while Qualcomm CDMA Chipset Market Share will trend slightly above, meaning that there could be an upside to Qualcomm’s stock.

Qualcomm manufactures integrated mobile chipsets used in mobile phones made by companies like Motorola (NYSE:MOT) and Nokia (NYSE:NOK). It competes with Texas Instruments (NYSE:TXN), Broadcom (NASDAQ:BRCM), and Infineon in this market.

We estimate that the mobile chipset business accounts for close to half of the company’s stock value. We currently have a Trefis price estimate of around $48 for Qualcomm’s stock, about 24% above the current market price of around $39.

Below are charts showing recent estimates created by Trefis members for the two drivers in detail.