This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Will Nokia's Siemens Venture Buyout Spell Profits?

There were even discussions about splitting-off NSN into an initial public offering -- creating a separate entity. But the uncertainty is now over. And I believe that Nokia's decision just raised its profile. As much as I've beaten up management for past failures there is now cause for optimism, especially given the high margin capabilities of the network business. Nokia has a better path towards long-term profitability.

Investors have to rejoice that Nokia's long-term success doesn't have to be so heavily weighted on the device business, which is not getting any better in terms of market share. But I do applaud the company for turning devices into a profitable business -- growing gross margin by 70 basis points in the recent quarter and reversing last year's loss.

Plus, with carrier spending expected to rebound, Nokia's NSN, which is already a leader in LTE (long-term evolution) networks, is poised to capitalize on the recovery. Interestingly, though, in one decision Nokia has now justified its highly criticized cost-cutting measures. This deal probably would not have been possible without an improved cash-flow environment.

It still remains to be seen, though, what Nokia ultimately does with NSN. From an investment perspective, it's premature to speculate how much value NSN will bring to Nokia absent clear operating strategies by management. But no matter how you look at it, Nokia's prospects and value have just improved given the many options it now has at its disposal, including selling NSN.

In the meantime, though, I'm still not ready to jump into this stock. But I'm no longer convinced that it's an absolute sell, either. It's taken 21 months into his tenure as Nokia's CEO, but I believe Stephen Elop has finally earned my respect. It's a good day for Nokia's investors.

At the time of publication, the author was long AAPL.

Follow @saintssense

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

Richard Saintvilus is a private investor with an information technology and engineering background and the founder and producer of the investor Web site Saint's Sense. He has been investing and trading for over 15 years. He employs conservative strategies in assessing equities and appraising value while minimizing downside risk. His decisions are based in part on management, growth prospects, return on equity and price-to-earnings as well as macroeconomic factors. He is an investor who seeks opportunities whether on the long or short side and believes in changing positions as information changes.
2 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,279.74 +13.75 0.08%
S&P 500 2,010.40 -0.96 -0.05%
NASDAQ 4,579.7890 -13.6380 -0.30%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs