Finnish mobile phone maker Nokia (
) will soon launch its ballyhooed N8 smartphone in the
U.S. Nokia has long been in need of a killer phone for the
crowded U.S. and European smartphone market, where it struggles to
compete with Apple (
), Research in Motion (
) and Motorola (
Overall we're bullish on the N8, which features a 12 megapixel
camera, the ability to shoot and edit HD videos, and live Facebook
feeds. Additionally, the N8 is the first smartphone to run
Nokia's Symbian 3 mobile operating system, which improves on
Symbian 2 in several respects.
If the N8 can help revive Nokia's fortunes in developed markets,
we see a potential 5% upside to our
$12.33 price estimate for the company's stock.
Our analysis follows below.
Nokia Losing Ground in the U.S. and Europe
We estimate that developed markets (U.S. and Europe) constitute
around 17% of the
$12.33 stock price estimate for Nokia
. The company's U.S. and European market share has slid steadily in
recent years, from 36% in 2006 to 28% in 2009. We expect this
decline to continue, reaching 19% by the end of Trefis forecast
But let's assume that the N8 finds favor with U.S. and European
consumers, allowing Nokia to hold its developed market share at 28%
between now and 2016. This scenario alone could add 5% to
our price estimate
Symbian 3 launch
The N8 will run Nokia's Symbian 3 operating system, which
includes new features like multi-touch, fast flip scrolling, and
free navigation software through Ovi Maps.
Symbian 3 was supposed to launch in the second quarter of 2010.
In an earlier article, we argued that an earlier launch of Symbian
3 could have helped Nokia compete more effectively against Apple's
iOS and Google's (
) Android OS. But it was not to be. Nokia's stock has declined from
around $12 a share last April to about $10 a share today, likely
due in part to the delay in launching the new Symbian based
You can see
the complete $12.33 Trefis Price estimate for
Nokia's stock here.