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Investing.com - Raymond (NSE:RYMD) James has lowered its price target on Nokia (NYSE:NOK) to $5.00 from $6.00 while maintaining an Outperform rating following the company’s second-quarter 2025 earnings report. The stock, currently trading at $4.34, appears undervalued according to InvestingPro analysis, with the company maintaining a strong balance sheet and holding more cash than debt.
The adjustment comes after Nokia negatively pre-announced results two days ago, citing foreign exchange fluctuations as the primary factor affecting performance. The euro-to-dollar exchange rate moved from 1.04 to 1.17, creating a stronger headwind than Raymond James had anticipated. The stock has declined over 8% in the past week, with technical indicators suggesting oversold conditions.
Despite the currency challenges, Raymond James noted that Nokia’s fundamental outlook and capital expenditure forecast have improved incrementally, with higher spending projections from leading U.S. customers and growing traction in new vertical markets. With annual revenue of $20.7B and healthy profit margins of 45%, InvestingPro analysis reveals 10+ additional insights about Nokia’s financial health and growth potential.
The research firm highlighted that Nokia’s acquisition of Infinera (NASDAQ:INFN) has doubled the company’s exposure to the fast-growing web scale segment, potentially positioning it for future growth opportunities.
While Nokia’s constant currency fundamental outlook remains unchanged, the foreign exchange movements prompted Raymond James to reduce its sales forecast by a mid-single digit percentage, with Nokia planning to host an analyst meeting in November to provide further updates.
In other recent news, Intel (NASDAQ:INTC) and Nokia have announced an expansion of their strategic partnership aimed at improving network efficiency in 5G infrastructures. The collaboration will integrate Intel Xeon 6 processors with Efficient-cores into Nokia’s NFVI v5.0 and Core Networks Applications. This initiative is expected to deliver significant enhancements, including a reduction in power consumption by up to 60% and a 60% smaller server footprint. Additionally, the performance of these systems is anticipated to increase by 150% compared to the older generation servers currently in use. These developments are part of a broader effort by both companies to optimize core network infrastructures.
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