Nokia: Cash flow-based valuation is not attractive
Overall, Nokia's Q4 results and outlook for 2024 were broadly in line with expectations. We saw no need for significant changes to our earnings forecasts at the group level, and which is why we found the share price reaction (+11%) on earnings day surprising. The valuation of the stock still looks moderate on adjusted earnings, but not particularly attractive in light of the free cash flow burdened by restructuring costs in the coming years.
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Nokia is a global telecommunications company. The company offers solutions in IP, broadband, digital health, and cloud-based systems. The customers are found in a broad base of markets and consist of large corporate customers, authorities, and private consumers. The business is established on a global level in all regions. Nokia was founded in 1865 and the head office is located in Esbo, Finland.
Read more on company pageKey Estimate Figures25.01.2024
| 2023 | 24e | 25e | |
|---|---|---|---|
| Revenue | 22,279.0 | 21,711.2 | 21,889.0 |
| growth-% | -10.6 % | -2.5 % | 0.8 % |
| EBIT (adj.) | 2,375.0 | 2,490.2 | 2,419.6 |
| EBIT-% (adj.) | 10.7 % | 11.5 % | 11.1 % |
| EPS (adj.) | 0.29 | 0.33 | 0.32 |
| Dividend | 0.13 | 0.14 | 0.16 |
| Dividend % | 4.3 % | 1.3 % | 1.4 % |
| P/E (adj.) | 10.6 | 34.0 | 34.7 |
| EV/EBITDA | 5.3 | 22.0 | 21.3 |
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