Trump’s glowing Nokia has been on the rise – A blunt assessment from an analyst

President of the United States Donald Trump on the other hand, a network equipment manufacturer brought it up yesterday Nokian A $30 million investment to expand semiconductor testing in Pennsylvania. Nokia is running a US-wide investment project of four billion dollars.

Nokia’s share price has been on the rise recently on the Helsinki Stock Exchange, fueled by artificial intelligence. The course has risen by around 125 percent this year, around 180 percent in a year.

After Trump’s comment, the course was on the rise again on Thursday. Inderes analyst Atte Riikolan however, in my opinion, the Trump effect is not seen in the stock.

He sees that Trump’s mention of Nokia has nothing to do with Nokia’s course in the big picture. According to Riikola, talks about the Trump supplement are “useless noise”.

“Although it doesn’t hurt to be in the president’s favor.”

Although the strong enthusiasm around artificial intelligence is now bringing Nokia a lift, Riikola does not see a buying seam in the company’s stock.

“In our view, earnings growth has been priced into the stock with such an advantage that its risk-return ratio is not attractive at the moment.”

More market shares may open up for Nokia

Nokia’s rise can be explained by the company’s investments in the network infrastructure needed by data centers, i.e. optical networks and IP networks. So Nokia has now joined the artificial intelligence craze.

The Infinera deal completed in 2025, which completed Nokia’s product range in optical networks, also gave additional impetus to the upward trajectory.

With the strong price increase, the company’s valuation level has tightened. Investors should consider now whether the company can meet the increased expectations.

The question arises whether Nokia will be able to increase its net sales strongly on the side of optical networks for several years. At the same time, profitability should rise to a very good level.

The artificial intelligence market and data center investments can offer Nokia an opportunity to win new market shares. Many of its competitors are already operating at maximum capacity, Riikola analysed. This means that Nokia may have an opportunity to win new market shares.

If this way the growth is really strong in the next few years, then it may be that the analysts’ consensus may be too cautious.

“But of course it requires really strong profit growth.”

No signs of abating

Another of the questions that may be puzzling investors at the moment is how sustainable the artificial intelligence craze is built on.

Although there is no exact answer, the Inderes analyst estimates that belief in the possibilities brought by artificial intelligence will continue to be strong in the next few years.

This is also evidenced by the historically large investments of the industry’s major players.

”Microsoft, Meta, Amazon, Google will invest heavily in artificial intelligence development in the next few years. In the next few years, investments can even rise to more than 1,000 billion.”

Driven by big numbers, we are now wearing glasses in the artificial intelligence craze. However, there is one but with the strong growth prospects.

“If, for one reason or another, it is found that we are now over-investing and then putting the brakes on, that can of course change this current narrative.”

Investors’ expectations are now high

The company’s share price was around 12 euros on Thursday. The target price set by Inderes is six euros.

If you now want to buy Nokia on the assumption that you want good returns in the longer term, it requires credit that strong profit growth will materialize.

In addition, the valuation level must remain high, which means that the growth outlook must remain strong several years from now, the analyst estimates.

“And in history, however, network equipment investments have been cyclical, that is, there has not been a simple increase from year to year.”

According to Riikola, from the point of view of a more forward-looking investor, there is currently no place to buy in the stock. Inderes currently recommends selling.

Currently, the p/e ratio, which measures the company’s valuation, is almost 40.

“But of course when the enthusiasm is on, in a way the valuation coefficient doesn’t matter that much in the short term.”