In a research report published Thursday, Canaccord top analyst Michael Walkley reiterated a Buy rating on shares of Nokia Corp (ADR) (NYSE:NOK), while reducing the price target to $5.50 (from $6.00), after the company issued cautious outlook for Q4/2016 and 2017, as its total addressable market expected to decline low-single digits in 2017.

Walkley commented, “Despite the challenging macro leading to our lowered revenue estimates, strong execution on reducing costs is allowing management to maintain their 2016 UBN operating margin target of 7-9% with strong execution potentially enabling Nokia to achieve results above the mid-point. 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.”

“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 €1.2B cost synergy target by 2018. We maintain our BUY rating, but lower our price target to $5.50 due to the challenging macro environment resulting in our lowered estimates,” the analyst concludes.

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, 5-star analyst Michael Walkley has a yearly average return of 13.9% and a 59% success rate. Walkley has a 5.4% average loss when recommending NOK, and is ranked #29 out of 4188 analysts.

Out of the 19 analysts polled by TipRanks, 15 rate Nokia stock a Buy, while 4 rate the stock a Hold. With a return potential of 41%, the stock’s consensus target price stands at $6.67.