Nokia Springs Back and Other Exciting News for the Week Ahead

Nokia was on the verge of giving up its mobile developments

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May 23, 2016
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As an investor, you’ve likely watched as Nokia (NOK, Financial) has gone through several stages. The company’s most notable move was signing on with Microsoft (MSFT, Financial) to produce Windows phones.

Unfortunately, the partnership turned out to be somewhat of a dud and has prematurely ended. The question one must consider is who is at fault for the downfall? Were consumers simply not interested in Windows phone? Or was Nokia unable to deliver quality products? If you feel the latter to be true and hold or want to hold stock in the company, there is good news for you.

In the first quarter, Windows phones only accounted for 0.7% of all global smartphone sales. Although BlackBerry (BBRY, Financial) was far worse, Microsoft realized its decision to produce smartphones wasn’t working out quite as it had expected. Now, Microsoft is splitting with Nokia, which will return to producing smartphones. The Finnish company has also received a consensus “Buy” rating from the 25 individual rating firms currently covering their progress. The company holds an average yearly price target of just over $8. Before opening, the stock sits at just $5.21, so there is definitely potential for the Nokia stock to climb higher. In other news, it was reported that the company will soon begin laying off employees.

Unfortunately, investors need to be concerned about the current state of oil prices. Through the years, the price of crude oil has fluctuated rapidly but has mainly ended at the lower end of the spectrum. That is until recently. Today, oil prices are higher than they have been for many months. That is expected to change, as the potential for an oversupply is giving investors concerns. Before the opening bell on Monday, Brent oil had traded down 1%, while West Texas Intermediate had been pushed down 1.2%. Last week, oil prices were pushed higher and higher by a handful of global problems, including the Canadian wildfire.

The turmoil in Africa also helped to keep the price high, but in recent days, opinions have begun to shift. Many see signs that supply levels are beginning to stabilize and that could spell doom for anyone hoping for an oil recovery in the near future. One thing to consider is the return of Suncor Energy (SU, Financial). The company was forced to shut down operations, due to the Canadian fire. Now, it will reopen and push the supply a tad bit higher. Previously, some analysts expected oil prices to increase to astronomical levels in the near future. However, energy expert Daniel Yergin insists the prices of oil will not top $100 per barrel. Yergin has written two books on the subject, and his words should be taken seriously.

For some companies, such as SolarCity (SCTY, Financial), which has previously worked with Expo Marketing, this may be a sigh of relief. Nonetheless, oil prices are unlikely to continue hanging at their current levels. If you’ve thought about buying into an oil producer, you may very well want to do so soon.

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