Canaccord top analyst Michael Walkley remains positive on Nokia Corp (ADR) (NYSE:NOK) and delves further, sharing an overview on the telecoms networks maker’s standing. On back of expectations for cost reductions coupled with bolstered fourth-quarter sales for the fiscal year of 2016, Walkley believes NOK is well-positioned to come in strong with a 2017 earnings surge.
As such, the analyst reiterates a Buy rating on NOK with a price target of $7.00, which represents just under a 26% increase from where the shares last closed.
Walkley asserts, “However, we believe ongoing healthy spending levels in China and the United States markets will lead to much stronger Q4/16 sales levels. Therefore, we anticipate improving margin trends in 2H/2016 as sales improve and management executes on its ongoing cost-cutting programs.”
“We believe Nokia management has a strong track record of operational excellence and will continue its strong execution on cost-cutting initiatives following the Alcatel Lucent acquisition. Further, we believe the technology licensing business can also create a source of high margin growth. Longer term, we believe the management team has a cogent plan to integrate Alcatel-Lucent to create a strong technology leadership culture while also achieving its recently increased €1.2B cost synergy target by 2018,” the analyst concludes.
According to TipRanks, which measures analysts’ and bloggers’ success rate based on how their calls perform, top five-star analyst Michael Walkley has achieved a high ranking of #29 out of 4,158 analysts. Walkley upholds a 59% success rate and garners 14.2% in his yearly returns. However, when recommending NOK, Walkley loses 5.0% in average profits on the stock.
TipRanks analytics show NOK as a Strong Buy. Based on 11 analysts polled in the last 3 months, 10 rate a Buy on NOK, while 1 maintains a Hold. The 12-month average price target stands at $7.28, marking a nearly 31% upside from where the stock is currently trading.