Nokia (Buy, TP: EUR7.50) - Shanghai constraints in focus
We expect continued underlying progress for Nokia in Q2, although we have shifted c3% of revenues to H2 due to the lockdowns in the Shanghai area and forecast Q2 EPS 11% below consensus. While the size of the revenue shift could deviate considerably from our estimate, we do not expect the full-year performance to be affected. A strong FX tailwind would have driven 2023e EPS up 6%, but, as we have trimmed our underlying revenue growth forecasts due to an expected cyclical headwind, it is broadly unchanged. Our 2022–2024e EPS remain 20–30% above consensus, and we reiterate our EUR7.5 target price and BUY.Nokia is an Internet and communications technology company based in Finland. Co.'s operations are focused on three businesses: network infrastructure software, hardware and services, which Co. offers through Networks; location intelligence, which Co. provides through HERE; and advanced technology development and licensing, which Co. pursues through Technologies. Co. maintains a global presence with operations and Researh & Development facilities located in Europe, North America and Asia, and sales in approximately 130 countries. Co. has an installed base of around 600 customers worldwide and these operators serve over 4 billion subscribers.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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