What Are the Fundamentals of Nokia (NOK)?

Nokia logged a -1.5% change Friday, and is now trading at a price of $4.58 per share.

Nokia shares moved -14.34% over the last 52 weeks, with a high of $5.5 and a low of $4.04. During this time, the stock lagged the S&P 500 index by -5.10%. As of January 2022, the company's 50-day average price is $4.72. Nokia Corporation offers fixed and mobile network solutions globally. The large-cap Consumer Cyclical company is based in Espoo, Finland. Nokia has returned a 1.8% dividend yield over the last 12 months.

The Company Has an Irregular Stream of Positive Cash Flows:

2019-12-31 2020-12-31 2021-12-31 2022-12-31
Revenue (MM) $23,315 $21,852 $22,202 $24,911
Revenue Growth n/a -6.27% 1.6% 12.2%
Gross Margins 35.71% 37.49% 39.79% 41.03%
Gross Margins Growth n/a 4.98% 6.13% 3.12%
Operating Margins 2.08% 4.05% 9.72% 9.31%
Operating Margins Growth n/a 94.71% 140.0% -4.22%
Earnings Per Share $0.0 -$0.45 $0.29 $0.75
EPS Growth n/a n/a 164.44% 158.62%
Free Cash Flow (MM) -$300 $1,280 $2,065 $873
FCF Growth n/a 526.67% 61.33% -57.72%
Capital Expenditures (MM) $690 $479 $560 $601
Net Debt / EBITDA -0.65 -0.56 -0.58 -0.25

Nokia Shares Are Inexpensive:

Compared to the Consumer Cyclical sector's average of 22.33, Nokia has a trailing twelve month P/E ratio of 5.8 and, according to its EPS guidance of 0.5, an expected P/E ratio of 10.53.

Furthermore, Nokia is likely undervalued in terms of its equity because its P/B ratio is 1.346 compared to its sector average of 3.12. The company's shares are currently trading somewhat above their Graham number, implying there is not much margin of safety for the stock. The Graham number is calculated according to the formula:

√(22.5 * 5-year average EPS * book value per share) = √(22.5 * 0.11 * 3.818) = $3.07

Most of the Market Indicators on Nokia Are Negative:

8 analysts are following Nokia and have set target prices ranging from $5.24 to $8.0 per share. On average, they have given the company a rating of buy. At the current price of $4.58, NOK is trading well below from its average analyst target price of $6.7 per share, implying an analyst consensus of little upside potential for the stock.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.