NEW YORK ( TheStreet) -- Nokia (NOK - Get Report) is reinventing itself. And investors on StockTwits.com like the man management announced Tuesday would lead the company's turnaround and his plan for remaking the former handset maker. But what they really liked was the $6.91 billion buyback and dividend program announced in conjunction with the new CEO appointment.
Nokia management selected Rajeev Suri as president and CEO, effective May 1. Suri has worked at Nokia for nearly two decades. He came from NSN, a former joint venture between Nokia and Siemens that became Nokia's network business.
Suri believes Nokia's future is in providing the infrastructure that connects devices and delivers data as well as growing location services for mobile phones. Nokia will also continue to invent and patent new technologies that it will license to other technology companies.
Last September, Microsoft (MSFT - Get Report) announced it would buy Nokia's handset and services business for $7.5 billion. About $2.17 billion of that deal was for a long-term agreement to license Nokia's patents.
Nokia's stock climbed nearly 4% after Nokia revealed Suri's appointment and capital plan. Nokia's earnings, also released today, were little cause for celebration. The company reported 3 cent EPS on $2.66 billion in sales. Those numbers missed consensus estimates for EPS by a penny, according to statistics on the Analyst Ratings Network.
Nokia does have a significant cash hoard to help develop its new strategy. If the transaction to sell its devices business to Microsoft had closed in the first quarter, Nokia would have had 10.5 billion euro -- or $14.51 billion -- in gross cash. The company will use some of that cash to repurchase shares and special dividends.
$NOK declared that the company will allocate -- 1 billion for one-time special dividends to be paid out in 2014 http://stks.co/h0YEu -- Bidness Etc (@BidnessEtc) Apr. 29 at 12:33 PMAt the time of publication the author held no positions in any of the stocks mentioned.
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