Nokia Stock Forecast: Nokia Is A Cheap Bet On 5G Revolution

motek 1The Nokia Stock Forecast article was written by Motek Moyen Research Seeking Alpha’s #1 Writer on Long Ideas and #2 in Technology – Senior Analyst at I Know First.


  • The COVID-19 pandemic has delayed the onset of the global 5G revolution. We should still bet on companies involved in the 5G infrastructure rollout business.
  • In spite of this pandemic, the 5G infrastructure industry is still growing at an estimated 51.01% CAGR. This niche market is expected to be worth $22.93 billion by 2025.
  • It is therefore judicious to go long on Nokia. Nokia is still the world’s no.2 vendor of telecom equipment products (3G, 4G, and 5G).
  • Nokia’s stock has a one-year price return of -28.11%. NOK is now very affordable to own. It trades at only 0.80x Price/Sales valuation. NOK’s forward P/E is just 11. 44x.
  • I Know First has a slightly bullish one-year outlook for Nokia’s stock.  The deteriorating US-China relationship is a long-term tailwind for NOK.

Most of us are likely underwater on Nokia (NOK). Instead of getting out, some of us still averaged down when NOK dipped below the $5 and $4 support lines. Our losses are just on paper. Patience on our part can eventually turn these paper losses to real profits. Two or three years from now, NOK might probably be trading above $6.50. Buy more NOK while it trades below $4. It might zoom up to $5 before 2020 ends.

NOK has a one-year price return of -28.11%. This should be taken as an opportunity part of a Nokia at a big discount.

(Source: Seeking Alpha)

Nokia’s stock can bounce higher by the second half of 2020. Investors’ emotion (pessimism) on NOK is not permanent. It will change to optimism because Nokia is pandemic-resistant. In spite of the negative impact of COVID-19 quarantines and business closures, Nokia still made a profit in Q1.  The chart below should also convince detractors that Nokia could prosper even without a substantial presence in China.  

(Source: Nokia)

Going forward, Nokia can consistently make a profit by focusing on its two most important markets, North America, and Europe. Revenue growth will turn positive once Nokia starts outplaying Huawei outside China. The COVID-19 pandemic raised the current importance of Nokia’s telecom hardware and software solutions. You should buy more NOK shares because quarantines around the world caused a big surge in internet usage. Fixed-line and wireless internet service providers are now scrambling to upgrade their networks to cope up with increased online activities by people forcibly stuck at home.

Why Nokia?

Nokia differentiates itself by having end-to-end solutions for internet service providers and data center operators. Customers outside China also get the assurance that Nokia will not be sharing internet traffic data to China’s government. NOK is a strong buy because it will remain a leader in the fast-growing 5G infrastructure industry. This niche market is growing at 51.01% CAGR and it will have a market size of $22.93 billion by 2025.

NOK is a strong buy because it has more than 60 commercial 5G contracts. Nokia is also aggressive when it comes to 5G patents. Nokia has filed more than 2k 5G-related patents. The more patent applications that are approved, the stronger Nokia becomes. Nokia needs all its weapons to disrupt the big lead of Huawei on 5G contracts.

(Source: Statista)

Buy More NOK and Profit Later

The persistent bias of Chinese telecom for Huawei and ZTE is a blessing for Nokia. Nokia has quit competing in the low-to-zero-profit-margin 5G radio business in China. Nokia finally realized the geopolitics Nokia is now focusing on other countries that are biased against its China-based rivals Huawei and ZTE.  The deteriorating relationship between the United States and China (over who is at fault for the COVID-19 virus’ global proliferation) will help Nokia regain market share it lost to Huawei. Pres. Trump will covertly ask U.S. allied countries to keep banning Huawei & ZTE equipment.

(Source: Dell’Oro Group)

Nokia can grow its market share to above 23% again after most U.S. allied countries start banning the use of Huawei and ZTE hardware and software products. Growing its business with a strong focus on non-China customers can lead to better profitability.


Nokia does not need to merge with another company to ensure its long-term prosperity. Steady growth in its telecom equipment business is already enough to boost NOK’s price. The current low valuation ratios make averaging down on NOK a decent strategy.  Any dividend-paying stock that only has a 0.8x Price/Sales ratio is always a bargain. We should invest in Nokia with fair optimism.

The DCF-centric Finbox stock evaluation platform gives Nokia a fair value of $4.80. It may take a year or two before Finbox’s verdict comes true but I am willing to bet on it.


The average price target for NOK at TipRanks is $4.57, or more than 27% upside potential. This is denoting that majority of Wall Street analysts remain optimistic about Nokia.

My buy rating for Nokia is also partly inspired by its semi-bullish one-year forecast score from I Know First. There’s enough probability that NOK will trade notably above  $4.50.

Past I Know First Success with NOK

I Know First has been bullish on the Nokia stock forecast in past predictions. The I Know First algorithm issued a bullish outlook on March 26, 2017. The algorithm forecast successfully predicted the movement of the Nokia stock and rose by 18.99% after three months. See the chart below.

Here at I Know First, our AI-based algorithm has modeled and predicted assets price movement worldwide for short-term and long-term time horizons, ranging from 3 days to a year. Since 2011, we have been providing stock market predictions, as well as daily undervalued stocks predictions, best stocks under 10 dollars predictions, forex forecaster, gold price predictions, and, in particular, Apple stock forecast. Today, we are producing daily forecasts for over 10,500 assets. These forecasts generated by our quant trading tool are used by institutional clients, as well as private investors and traders to identify the best investment opportunities in the market.

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