), the world's leading mobile chipset developer, to beat
expectations when it reports fourth-quarter 2013 results, before
the market on Jan 23, 2014.
Why a Likely Positive Surprise?
Our proven model shows that Nokia is likely to beat earnings
because it has the right combination of two key ingredients.
The Expected Surprise Prediction or
, which represents the difference between the Most Accurate
estimate and the Zacks Consensus Estimate, stands at +33.33%.
This is a meaningful and leading indicator of a likely positive
Nokia currently has a Zacks Rank #2 (Buy). Note that the stocks
with Zacks Rank #1, 2 or 3 have a significantly higher chance of
beating earnings. The Sell-rated stocks (Zacks Rank #4 and 5)
should never be considered going into an earnings announcement.
The combination of Nokia's Zacks Rank #2 and +33.33% Earnings ESP
makes us confident of a positive earnings beat.
What is Driving the Better-Than-Expected
Nokia's Lumia flagship device business started witnessing rising
demand with 40% year-over-year rise in shipments. Moreover,
launch of different mix of handsets targeting both high and
low-end markets will continue to drive mobile phone sales for the
company while moving ahead.
A huge patent portfolio coupled with the cost-cutting measures
implemented by Nokia will not only boost its margins but will
also generate incremental cash flows in the upcoming
In the reported quarter, the company achieved operating
profitability for the fifth time consecutively. Furthermore,
Nokia decided to extend its Here Drive+ and Here Transit mapping
application to all smartphones running on Microsoft Corporation's
Windows 8 platform.
In Sep 2013, Microsoft decided to acquire Nokia's handset
business for $7.2 billion (5.44 billion euros). The deal is
expected to close by the end of the first quarter of 2014.
Other Stocks to Consider
Other companies you may consider on the basis of our model, which
have the right combination of elements to post an earnings beat
this quarter are as follows:
SBA Communications Corp.
) has Earnings ESP of +150% and carries a Zacks Rank #2
AMER TOWER CORP (AMT): Free Stock Analysis
EQUINIX INC (EQIX): Free Stock Analysis
NOKIA CP-ADR A (NOK): Free Stock Analysis
SBA COMM CORP (SBAC): Free Stock Analysis
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) has Earnings ESP of +6.58% and carries a Zacks Rank #3 (Hold).
American Tower Corp.
) has Earnings ESP of +6.38% and a Zacks Rank #3 (Hold).