Wells Fargo analyst Maynard Um is out with a research report on shares of Nokia Corp (ADR) (NYSE:NOK) after the telecom giant and NOK competitor Ericsson announced that it anticipated a 1 to 3% total addressable market growth between 2016 and 2018. In particular, the company warns of near-term soft demand with regards to mobile broadband, with expectations for this trend to sustain through 2016 with a decrease of 10 to 15% and throughout 2017 with a smaller 2 to 6% drop.

Anticipating similar declining trends for Nokia and its primary addressable market, the analyst reiterates a Market Weight rating on NOK with a valuation range of $4.50 to $5.00, which represents a 1% to a close to 13% increase from current levels. For 2016, the analyst projects Network sales to wane 10.8% and for 2017, the analyst forecasts a 3.5% decline.

Um believes, “While there could be tailwinds that can drive the Networks and that are not in our model (new spectrum in China and India, wholesale projects in Latin America, public safety in North America), we believe visibility is low and think the likelihood of market pressures subsiding near-term is low. However, we believe NOK will continue to manage through the transition by focusing on margin and cost controls.”

“NOK is to host its Capital Markets Day in Barcelona next Tuesday, November 15th. We expect NOK to highlight trends similar to ERIC’s view in its Networks business as well as focus on its growth opportunities in adjacent markets, though think NOK’s investments here will take time to grow to be meaningful enough to offset Networks pressures. We maintain our Market Perform rating as we expect 2017 to be another year of transition for the company given continued end-market pressures and re-investments before seeing bulk of its restructuring benefits in 2018,” Um surmises.

As usual, we like to include the analyst’s track record when reporting on new analyst notes to give a perspective on the effect it has on stock performance. According to TipRanks, five-star analyst Maynard Um is ranked #269 out of 4,200 analysts. Um has a 61% success rate and realizes 10.3% in his annual returns. When recommending NOK, Um earns 0.0% in average profits on the stock.

TipRanks analytics indicate NOK as a Buy. Out of 10 analysts polled by TipRanks, 70% are bullish on Nokia stock, 20% remain sidelined, and 10% are bearish on the stock. With a return potential of 55%, the stock’s consensus target price stands at $6.98.