Nokia Upgraded to Buy at Citi on Improving Fundamentals
2022.06.14 19:11
Nokia (NOK) Upgraded to Buy at Citi on Improving Fundamentals
By Sam Boughedda
Citi analyst Andrew Gardiner upgraded Nokia (NYSE:NOK) to Buy from Neutral Tuesday, raising the firm’s price target on the stock to €6.50 from €6.
The upgrade, according to a note by Gardiner, is driven by improving fundamentals that are being largely ignored by the market.
The analyst said the mobile infrastructure market is showing strong momentum, particularly in Nokia’s key U.S. market.
“Nokia’s decade-long share losses have ceased and are showing signs of improvement. Our time with Nokia management coupled with a strong performance in 1Q22 gives us confidence in the company achieving 2022 margins near the top of its 11-13.5% range,” said Gardiner. “We also model it reaching its long-term >14% margin target in 2024, a year sooner than guidance/consensus.”
However, the analyst acknowledged that despite improving fundamentals, investor interest is limited.
“We expect 2022 guidance to be upgraded with 2Q22 results in July, providing a positive catalyst for shares,” added Gardiner.
