Nokia’s Two Faces: Analyst Upgrades Clash With Pre-Earnings Profit-Taking
Published on 07/22/2026 at 19:41 | Redaktion boerse-global.de
Helsinki-listed shares slip 3.4% as SEB’s buy rating fails to hold the rally
Nokia finds itself caught between a bullish analyst chorus and a nervous market that is already pricing in the risk of disappointment. The Finnish network equipment maker’s stock dropped 3.44 percent to €9.09 in Helsinki on Wednesday, erasing the previous session’s gains that had been sparked by an upgrade from SEB Equities. The analyst house raised its recommendation from hold to buy with a €12.00 price target, triggering an initial 5 percent jump on Tuesday. But the enthusiasm faded fast.
The pullback highlights the tension ahead of Nokia’s second-quarter results, due Thursday at 8:00 a.m. CEST, followed by a webcast at 3:00 p.m. With the stock’s 30-day annualized volatility hovering near 67 percent and a relative strength index of 35.7, investors appear to be locking in profits rather than betting on a clean beat. The gap to the 50-day moving average of €11.80 now stands at roughly 23 percent — a stark reminder of how sharply the shares have corrected from their June highs.
What the numbers are expected to show
Analyst consensus points to second-quarter revenue of €4.822 billion, a 6.1 percent increase year-on-year, with comparable operating profit rising 24.9 percent to €376 million, implying a margin of 7.8 percent. That would place the quarter near the upper end of Nokia’s historical seasonal range of 12 to 16 percent of full-year earnings. Earnings per share under GAAP are forecast at €0.051.
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Within the segments, Network Infrastructure is projected to grow 11.9 percent to €2.044 billion, driven by surging demand for optical transport systems used in AI data centers. Mobile Networks should add 2.4 percent to €2.587 billion. Nokia had already raised its growth forecast for the Network Infrastructure unit to between 12 and 14 percent, citing the AI-related optical boom.
CEO Justin Hotard has signaled that the company is tracking above the midpoint of its full-year operating profit guidance of €2.0 billion to €2.5 billion. Still, the stock trades at roughly 28 times expected 2026 earnings — a valuation that leaves little room for error. The memory of rival Ericsson’s recent margin squeeze from rising AI-related costs adds an extra layer of scrutiny to Nokia’s own cost structure.
Strategic bets beyond telecom hardware
Nokia’s transformation story is increasingly built on optical networks and IP infrastructure rather than traditional telecom gear. Two recent developments underscore the pivot:
- On July 15, Nokia and Nvidia unveiled what they call the world’s first commercial AI-native RAN platform, targeting a doubling of spectral efficiency by 2028.
- A day earlier, Nokia expanded its partnership with Taiwan Mobile on AI-powered 5G networks, leveraging the AirScale portfolio and MantaRay software.
These moves align with the broader push into data-center connectivity, where Nokia’s optical transport systems are gaining traction. Revenue from AI and cloud solutions already jumped 49 percent in the first quarter.
A tale of two markets
The divergence between Nokia’s Helsinki listing and its New York-traded shares adds another layer of complexity. While European investors turned sellers on Wednesday, the US-listed shares had rallied sharply the prior session and continued to edge higher in after-hours trading. JPMorgan reinforced the bullish case by raising its price target on the US listing to $21 from $14, maintaining an overweight rating.
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On the shareholder front, FMR LLC — the parent of Fidelity — has trimmed its stake below the 5 percent reporting threshold. Meanwhile, Nokia transferred roughly 43.6 million shares on July 9 to participants in its equity-based compensation programs, leaving the company with about 88.6 million treasury shares.
The bottom line
Thursday’s report will test whether Nokia’s AI-driven growth narrative can justify its elevated valuation. The Network Infrastructure margins, the trajectory of the new RAN platform, and any commentary on cost trends will all be in focus. For now, the market is hedging its bets, leaving the stock in a tug-of-war between analyst optimism and pre-earnings caution.
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