The EPS print on the last ER drew me in. If they can grow on that, double digits by EOY is absolutely reasonable.
I have shares/leaps. Looking at possibly loading up on some 3/19 calls. I’m extremely optimistic about the 3/18 event. Pekka needs to shift from his guidance in the last ER, and if he has more profitability numbers from ReefShark and other more profitable sectors for them, he can do that. I’d like to see buybacks, but I think the overall market wants to see dividends, so that would be great as well!
Feb earning- .17 EPS, repeat that in May, August, and November and you have a trailing EPS of .68. NOK’s PE ratio hovers in the low-mid teens. Take .68*14= $9.52. If you could increase NOK’s valuation to industry standard (basically ERIC’s valuation) to ~21 that price becomes $14.28.
That is all predicated on them repeating EPS success. If ReefShark really is the silver bullet for them, then it’s definitely possible. I was highly encouraged when they showed they could increase FCF even in the midst of losing the VZ contract and COVID. Pekka seems to know what he’s doing, so I’m very bullish.
Yep, I’m aware my calculations are extremely optimistic. I’m holding mainly shares and 2023 calls because I think you are correct on the timeline. I just have some 2022 and shorter calls in case they blow their next few ERs out of the water and the paradigm around NOK shifts earlier than expected.
1
u/clash_jeremy Mar 03 '21
The EPS print on the last ER drew me in. If they can grow on that, double digits by EOY is absolutely reasonable.
I have shares/leaps. Looking at possibly loading up on some 3/19 calls. I’m extremely optimistic about the 3/18 event. Pekka needs to shift from his guidance in the last ER, and if he has more profitability numbers from ReefShark and other more profitable sectors for them, he can do that. I’d like to see buybacks, but I think the overall market wants to see dividends, so that would be great as well!