It ain't ugly... it's beautiful. All those people who griped about not buying Nokia when they should have now get another shot. Everybody deserves a second chance - but if they don't buy now they can only blame themselves when the third quarter results come out.
You're right about Russia... I think Nokia has bigger sales in South Africa than there. What are the investors afraid of? That a Russian mob of enraged equity owners will sack Nokia's headquarters? It's true that the border is just 200 miles away, but let's get real.
The way Finnish pension system is rigged I'll be retiring around 2038. So I guess I can fight back the tears if Nokia dips to a level where it was three weeks ago. This isn't even a blip when you look at the 50-week cart. It's good to think about fundamentals right now:
* The 8810 and 6150 launches are in schedule, phones are hitting retailers within two weeks in some Asian and European countries. The latest phenomenal Nokia run-up began in earnest in February when the first reviews of Nokia's 6100 models started to appear with headlines like "Der Superhandy!" and "Nokia 6110 - Coup de Coeur". No matter what happens on Wall Street, the new reviews and consumer reaction within 4-6 weeks should have an impact. After all, this is a consumer product company and ultimately the stock is driven by the product, not ephemera like "P/E ratio", "stochastic analysis", "advances versus decliners of Dow" and all that happy crap.
* There's a little thrill of schadenfreude as the news about Iridium keep trickling in. More satellite trouble, no consumer awareness in Europe, 70% completion rate in calls a month before the product launch, software problems, Kyocera's delayed handset production, etc. Nokia doesn't really need a succesful satellite phone to compete with the outrageously expensive 8810 even if the products are in different categories. Euroexecutives will not buy both a 1'000 dollar GSM gizmo and a 3'000 dollar satellite behemoth, so every bit of bad news on that front helps.
* 6100 phones still selling out in USA, in Europe the shortages have mostly stopped, but now the 5100 models are sold out. The production keeps ramping up at a faster pace than in any other phone launch in the history of the industry - but the phones don't even hit the shelves before they're snapped up.
* That Global Positioning System chip that will be implanted in future Nokia phones shows how this company is still dictating the direction the industry is taking. Bluetooth, Symbian, WAP, GSP... as Nokia/Ericsson axis keeps charging on the rest of the pack are just forced to scramble.
* Outrageously, Ericsson has said they will hold on to their two year strategy in launching new phone platforms. They seem to have dropped the ball here. Nokia is exploiting this by shortening their product cycle. New low-cost manufacturers are hamstrung by the rapid pace of change... they can't undercut in price as long as Nokia has both the superior production volumes and new features every year.
* Somebody at Yahoo posted numbers about the announced network orders in the first half of -98. The source maybe suspect, but the numbers are hot: Nokia was number two in the world when all systems sales from AMPS to CDMA were included, ahead of Lucent, but admittedly trailing far behind Ericsson. Never mind, number two slot would be good indeed.
Go ahead, Wall Street, short this stock to sixties... the payback's a bitch.
Tero
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