Nokia Oyj Stock Sell Recommendation Reiterated (NOK)
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- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Communications Equipment industry and the overall market, NOKIA CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- NOK has underperformed the S&P 500 Index, declining 12.00% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
- The revenue fell significantly faster than the industry average of 14.9%. Since the same quarter one year prior, revenues fell by 22.5%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- NOK's debt-to-equity ratio of 0.73 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.97 is weak.
- NOKIA CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, NOKIA CORP reported poor results of -$1.11 versus -$0.41 in the prior year. This year, the market expects an improvement in earnings ($0.06 versus -$1.11).
--Written by a member of TheStreet Ratings Staff. Exclusive Offer: Jim Cramer's 'go-to' small/mid-cap guru Bryan Ashenberg only buys stocks he thinks could return 50-100%. See his top picks for 14-days FREE.
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