Science & Technology
Science and Technology
Science and Technology
Thu, May 27, 2010
Wed, May 26, 2010 
CHICAGO--([ BUSINESS WIRE ])--Zacks.com Analyst Blog features: Nokia Corp. (NYSE: [ NOK ]), Research In Motion (Nasdaq: [ RIMM ]), Apple Inc. (Nasdaq: [ AAPL ]), Google Inc. (Nasdaq: [ GOOG ]) and Intel Corp. (Nasdaq: [ INTC ]).
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Here are highlights from Tuesdaya™s Analyst Blog:
Earnings Scorecard: Nokia Corp.
The recent Zacks Consensus earnings estimate revision trend clearly indicates a disappointing outlook for Nokia Corp. (NYSE: [ NOK ]). It seems analysts are highly concerned about Nokiaa™s success in lucrative smartphone market, which is gradually becoming the next-generation choice. Lack of any immediate catalyst resulted in an extremely pessimistic earning revision trend for the company.
First Quarter 2010 Highlights
Nokiaa™s first quarter EPADR was a penny below the Zacks Consensus Estimate, with revenues also lagging more than 5%. This was primarily due to lower-than-expected mobile devices sales.
Though it shipped 21.5 million smartphones in the first quarter, the Nokia gadget is nowhere near battling the iPhone, BlackBerry, or the Android-powered mobile devices on their own ground. As a result, Nokia is gradually losing its market share to Research In Motion (Nasdaq: [ RIMM ]), Apple Inc. (Nasdaq: [ AAPL ]) and Google Inc.a™s (Nasdaq: [ GOOG ]) smartphones.
Lack of penetration in the high-margin smartphone market is putting pressure on the companya™s bottom line. Quarterly ASP of the Mobile Devices was around $83.5, down 6% year over year and also down 3% sequentially. Management now expects an operating margin of 11%a'13% in its core Devices and Services segment, down from previous expectations of 12%a'14%.
Agreements of Analysts
The overall estimate revision trend is rather glum. In the last 30 days, out of 24 analysts covering the stock, 17 analysts reduced their estimates for the June quarter and 16 analysts reduced their estimates for the September quarter.
Additionally, in the last 30 days, out of the 28 analysts covering the stock, 24 analysts reduced their estimates for full fiscal 2010 and 21 analysts reduced their estimates for full fiscal 2011. This strong negative estimate revision trend also holds when we notice that none of the analysts raised the estimate for forthcoming quarters or the full fiscal year.
We believe most of the negative sentiment comes from Nokiaa™s inability to launch upgraded Symbian 3 OS. Smartphones are generally characterized by very powerful operating systems capable of supporting awide variety of services and applications. Unfortunately, Nokiaa™s existing Symbian OS is one generation behind the iPhone, BlackBerry, or the Android. The companya™s partnership with Intel Corp. (Nasdaq: [ INTC ]) for Linux-based MeeGo OS is still a distant reality.
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