Swedbank Markets analyst Haakan Wranne told Bloomberg that with Nokia’s stock trading at just over EUR2.00, “it’s obvious that there is more value than that in the assets” – making it understandable that takeover rumours make its stock jump. However, Canaccord Genuity analyst Bo Nordberg said Nokia is not a “particularly compelling” proposition and that the analyst community is “quite sceptical” about the company’s outlook.
Prior to last week’s increase, Nokia’s share price had declined by 41 percent since the beginning of the year, while Samsung overtook the company in the first quarter of the year to become the world’s largest handset maker.
Nokia has been struggling to compete in the smartphone arena but is pinning its hopes on the tie-up with Microsoft to use Windows Phone, announced in February 2011. The first Windows Phone Lumia devices were announced in October, with several new models having arrived since.
The company reported a EUR929 million loss for Q1 on total sales of EUR7.4 billion, down 29 percent on the same period a year earlier. In response to the results, CEO Stephen Elop said the company has a “clear sense of urgency to move our strategy forward even faster” with cost savings in the Devices & Services division a priority.