Shares of Nokia (NOK) have gone lower and lower as the session has worn on, currently down 79 cents, or almost 16%, at $4.24, as the Street digests the implications of this morning's warning that Q1 results came in weaker than expected, as handset units and prices were under pressure from rising competition. Aside from noting the dispiriting struggle of the company's older handsets, the "Symbian" software-based devices, analysts are generally unimpressed by what the company has achieved thus far with its new line of "Lumia" handsets, developed through its partnership with Microsoft (MSFT): Scott Thompson, FBR Capital Markets: Reiterates a Market Perform rating, is skeptical about Lumia, writing that sales of the device family of "slightly above 2 million units" in Q1 was "well under FBR and street estimates" and that the "expected Lumia ASP of €220″ was also lower than he'd anticipated. "Management indicated Lumia sales are gaining share across carriers, but we are cautious that Lumia may not gain the momentum to stave off Nokia's eroding smartphone market share until early 2013." Mark McKechnie, ThinkEquity: Reiterates a Hold rating and a $5 price target. He also notes the pricing pressure on Lumia devices and thinks a turnaround will take some time: "We see a prolonged transition as new WP7 phones ramp, Symbian sales decline, and feature phones get displaced by smart phones. We maintain our long-term "stretch" EPS power estimate of €0.50-€0.60 based on NOK achieving strong share of the WP7 market at 7.7% operating margins. Our analysis does not include contribution from tablets and/or notebooks which we suspect NOK will target on the Windows8 platform." Read the rest>>>>> |
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