Nokia Accelerates Introduction of 5G Services Across Australia

Nokia (NOK) has taken the initial steps to accelerate the introduction of 5G services across Australia. The network infrastructure company has deployed the first Interleaved Passive Active Antenna (IPAA) solution in the country in partnership with Optus. (See Nokia stock analysis on TipRanks)

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Developed in partnership with CommScope (COMM), the IPAA solution is designed to accelerate the deployment of 5G by making it easier to upgrade existing infrastructure. Operators will simply need to replace antennas with similar-sized units to support legacy technologies.

“By partnering with global technology leaders like Nokia, we continue to bring the best global innovations to our customers. The introduction of the IPAA into our network infrastructure will help us speed up the deployment of our 5G network by addressing space and structural capacity constraints,” said Optus MD of Networks Lambo Kanagaratnam.

In other unrelated news, Nokia has agreed to license its mobile telecommunications technology to Daimler (DDAIF). The agreement comes on the back of the two companies agreeing to settle all pending litigation between them. Terms of their arrangement remain confidential. (See Daimler stock analysis on TipRanks).

Charter Equity Research Edward Snyder recently reiterated a Hold rating on the Nokia stock. According to the analyst, Nokia remains well-positioned to benefit if China excludes Ericsson from upcoming 5G tenders. Tensions between Sweden and China may provide Nokia with an opportunity to take market share away from one of its largest competitors.

A decision by the Swedish Post and Telecommunications Authority to exclude Chinese vendors from Swedish 5G auctions is expected to trigger an immediate reaction from China. A probable outcome would be Ericsson being barred from China 5G tenders, a move that could benefit Nokia. (See Ericsson stock analysis on TipRanks)

Snyder stated, “We believe this political conflict contributed to Nokia’s decision to re-enter China after essentially exiting the market in 2019 since it struggled to compete with other OEMs in performance and cost. On its recent earnings call, Nokia claimed performance of its 5G radios has improved substantially such that it can now compete with equipment from other OEMs.”

Consensus among analysts on Wall Street is a Moderate Buy based on 5 Buy and 3 Hold ratings. The average analyst price target of $5.67 implies 9.25% upside potential to current levels.

NOK scores a 6 out of 10 on TipRanks’ Smart Score rating system suggesting its performance is likely to align with market expectations.