Microsoft And Nokia: Who Needs the Other More?

Microsoft (NASDAQ: MSFT  ) and Nokia (NYSE: NOK  ) have a problem -- each other.

The two companies came together under desperate circumstances in their 2011 deal. At the time, each company got something it badly needed. For Nokia, it came down to money. Microsoft was simply willing to shell out enough to buy Nokia time to transition away from its burning platform. For Microsoft, Nokia gave it an immediate flagship, brand-name partner from which it could launch into the smartphone space in order to compete with dominant rivals Apple and Google  (NASDAQ: GOOGL  ) . And while this deal seemed full of promise at the time, it hasn't quite been the home run both parties had hoped for. In this video, Fool contributor Andrew Tonner looks at the two companies and some interesting recent findings on which tech power needs the other more.

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Read/Post Comments (8) | Recommend This Article (1)

Comments from our Foolish Readers

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  • Report this Comment On August 21, 2013, at 6:47 PM, lee654 wrote:

    MSFT. needs Nokia ! Nokia has the Key for #1 in the world ! LS

  • Report this Comment On August 21, 2013, at 9:31 PM, techy46 wrote:

    Microsoft should buy Nokia for $5-6 PS or about $20 billion. They should then buy Dell for $24 billion and tell everybody else that Windows is no long for license on any 3rd party hardware. That would put them on equal footing with Apple and give Google, Lenovo and Samsung something to think about.

  • Report this Comment On August 21, 2013, at 10:02 PM, toraji40 wrote:

    Andrew,

    microphone???? Your glasses are not making you smarter and maybe you should take that grin of your face when you talk about the 175.000 good apps compared to the 500.000 double and fart apps?

    Your contribution to the world of smartphones is not contributing to the way the world is and your "readers" are not benefitting from your biased opinion

    regards

    t

  • Report this Comment On August 21, 2013, at 11:34 PM, chilero wrote:

    The number of apps is just a talking point. One should focus more on "key" apps and big name apps. Microsoft is still behind in those areas but they are improving and should be close to even by the end of 2013.

    Windows Phone offers a trial experience which eliminates the need for a free app and pro/paid app. Essentially the same app get's counted twice in the Apple store and the Google store.

    Windows Phone is growing which shows that consumers do in fact like Windows Phone. Worldwide the marketshare is still low but in a number of regions such as Latin America Windows Phone is #2, ahead of iPhone. In Colombia they have 25% of the market.

    A weak but growing market for Windows Phone is the USA which is why we see a negative bias with regards to Windows Phone as they tend to project what is happening in the US must also be happening everywhere else.

  • Report this Comment On August 22, 2013, at 6:31 AM, sankhlarajat wrote:

    obviously Microsoft needs NOKIA..

  • Report this Comment On August 22, 2013, at 10:47 AM, DZPM wrote:

    The current financial condition of NOK is very strong as evidenced by the large number of positive fundamental factors. The stock represents a good value when compared to other stocks in its industry group and appears likely to experience further price appreciation. NOK's ability to generate future earnings appears somewhat questionable at this juncture when compared to industry averages. The company’s finances are sound at this time but it needs to be careful regarding its debt ratios. Operating margins declined last quarter but operating cash flow remains positive. Looking forward, the analyst consensus forecast for revenue and earnings for the next two quarters is expected to show improvement versus the prior quarter. Price momentum is strong and the stock has outperformed the market when compared to the S&P 500. As long as the positive fundamental outlook does not change, this stock should be a strong performer over the intermediate term.

    The Price/Cash Flow ratio is 1.27. A low ratio shows a strong ability to generate cash and reflects well on a company’s stock price and liquidity. The average Price/Cash Flow ratio for this Industry Group (Comm. Equip.) is 24.88.

    Leading Price/Earnings (P/E) Ratio / Earnings Growth Rate) ratio is 0.52. This ratio is the Leading P/E ratio divided by expected per share earnings growth over the coming year. A PEG ratio greater than 1 indicates a stock may be overvalued or the market expects future Earnings Per Share (EPS) to be greater than the EPS consensus. The average PEG ratio for this Industry Group (Comm. Equip.) is 1.09.

    NOK's PRVit score is at the 84th percentile of all firms in its industry, which leads to a recommendation to BUY. NOK is more attractively priced in relation to its true value than well over half of the stocks in its industry. Nokia is nothing but BUY…BUY…Buy I am long but 10,000 today.

    Yes Go NOK Go !

  • Report this Comment On August 22, 2013, at 10:47 AM, DZPM wrote:

    The current financial condition of NOK is very strong as evidenced by the large number of positive fundamental factors. The stock represents a good value when compared to other stocks in its industry group and appears likely to experience further price appreciation. NOK's ability to generate future earnings appears somewhat questionable at this juncture when compared to industry averages. The company’s finances are sound at this time but it needs to be careful regarding its debt ratios. Operating margins declined last quarter but operating cash flow remains positive. Looking forward, the analyst consensus forecast for revenue and earnings for the next two quarters is expected to show improvement versus the prior quarter. Price momentum is strong and the stock has outperformed the market when compared to the S&P 500. As long as the positive fundamental outlook does not change, this stock should be a strong performer over the intermediate term.

    The Price/Cash Flow ratio is 1.27. A low ratio shows a strong ability to generate cash and reflects well on a company’s stock price and liquidity. The average Price/Cash Flow ratio for this Industry Group (Comm. Equip.) is 24.88.

    Leading Price/Earnings (P/E) Ratio / Earnings Growth Rate) ratio is 0.52. This ratio is the Leading P/E ratio divided by expected per share earnings growth over the coming year. A PEG ratio greater than 1 indicates a stock may be overvalued or the market expects future Earnings Per Share (EPS) to be greater than the EPS consensus. The average PEG ratio for this Industry Group (Comm. Equip.) is 1.09.

    NOK's PRVit score is at the 84th percentile of all firms in its industry, which leads to a recommendation to BUY. NOK is more attractively priced in relation to its true value than well over half of the stocks in its industry. Nokia is nothing but BUY…BUY…Buy I am long but 10,000 today.

    Yes Go NOK Go !

  • Report this Comment On August 22, 2013, at 11:23 AM, vcda1st wrote:

    Just a note: In the upper corner in your Profile about, you have a typo that states "He is a graduated from..." I'm sure you want that corrected.

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