Nokia’s Rally Leaves Analysts Playing Catch-Up as Data-Center Ambitions Take Shape

The Finnish telecom equipment maker has become one of the market’s most surprising redemption stories. Nokia’s share price has surged 117% since the start of the year, climbing another 40% in the past 30 days alone to trade at €12.08-€12.11 — a hair’s breadth below its 52-week high of €12.55. The rally has been so ferocious that it now sits above the average analyst price target, a situation that places intense scrutiny on the company’s ability to deliver the operational results that would justify the valuation.

This week, investors will get a clearer sense of Nokia’s strategic direction as CEO Justin Hotard takes the stage at the JP Morgan Technology Conference in Boston on Tuesday, while technology chief Walid Wakim delivers a keynote at the International Telecoms Week. The dual appearance underscores management’s push to diversify beyond traditional telecom carriers and win more business from government agencies and large enterprises — a pivot that helped ignite the recent stock surge.

A key piece of this diversification strategy is the optical networking business, which Nokia has already upgraded to growth guidance of around 20%. The potential extends further. Deutsche Bank analysts estimate that the data-center switching segment alone could unlock €400 million in additional revenue following Nokia’s acquisition of Infinera, which has already lifted gross margins. With net liquidity of €3.8 billion, the balance sheet provides ample firepower to fund the expansion.

Should investors sell immediately? Or is it worth buying Nokia?

The company is simultaneously reshuffling its leadership to manage the transition to next-generation networks. Emma Falck, recruited from Siemens, will take over the mobile infrastructure division in September 2026. With a background in computational physics, she is tasked with steering Nokia’s 5G and 6G strategy toward software-driven, open network architectures — technologies that are increasingly critical for data-heavy artificial intelligence workloads.

Earlier this month, the company reinforced its defense-sector ambitions by announcing a collaboration with Lockheed Martin to develop specialized 5G solutions. The deal complements a broader push into AI-native networks, including new tools for broadband that can automate fault detection and push customer-service resolution rates above 50%, as the company detailed last week.

The rally has certainly lifted the company’s valuation multiple. Nokia now trades at 33 times trailing earnings, well above the industry average, and the current price has already blown past the €12.00 price target recently set by JPMorgan. Argus Research sees fair value at $15, but the stock’s rapid ascent means every upcoming data point carries extra weight. Management has maintained its full-year guidance for comparable operating profit of €2.0 billion to €2.5 billion, with optical network infrastructure expected to shoulder the growth burden while the legacy radio business remains flat.

All eyes will turn to Nokia’s half-year results due on July 23 (or late July, per an earlier schedule). If the company can hit its margin targets and show concrete progress in the data-center and enterprise segments, the current market premium could prove justified. If not, the stock’s run-up has left little room for error.

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