Seeking Alpha: Nokia undervalued stock, “Nokia’s is a steal at the current price and has a great future ahead of itself.”
Seeking Alpha has been looking at a few reasons why Nokia is currently a very undervalued stock, concluding that
“ Nokia’s is a steal at the current price and has a great future ahead of itself.”
Seeking Alpha has been mulling over this subject for a while now over several recent articles, from not recommending, to unsure to now recommending Nokia.
Speaking on Value:
Nokia’s current value is mind-boggling. It is one of the most undervalued stocks I have ever seen. Nokia’s share price peaked at $40 in 2007 before declining to just $2.63. Part of this has come from Nokia truly losing value, however, most of it has come from consumer idiocy. Consumers have got too attracted to Apple and Google and have ignored smaller but better deals. Nokia’s current market capitalization is just $9.77 billion. It is worth more than $10 billion just from its share of the mobile market, in fact is worth significantly more if judged on a similar standard to Apple. On top of this, Nokia has compelling fundamentals, a solid cash flow, and an attractive balance sheet. Its metrics are a very attractive picture for potential investors. Its price/sales ratio 0.20. This is incredible as a company which is much worse off, the ailing company Research In Motion, trades at a price/sales of 0.27. Nokia’s price/book is at just 0.66.
Other factors include:
- Rich patent portfolio
- Potential Lumia 900 success
- Potential Windows 8 success
- Debt not an issue
Risks are noted, but Nokia’s value should apparently be higher even prior to Nokia doing anything with Windows 8.
The competition is tough and getting tougher. Should Nokia complete the turn around, Nokia’s stock is expected to increase rapidly. Right now it is the risk of the investors whether they believe Nokia stock truly is undervalued and Nokia’s future products can catch on.
I’m biased, but I see Nokia has a great future ahead of itself. There are more things going on at Nokia than Windows based products. S40 Full touch is just one example of that.
The first couple of quarters might not suggest that is the case but big, key things might be seen in the second half of 2012.