I have been trying to understand the stock market lately; I don’t know much about it, but from browsing around, there’s things that just don’t make common sense. For example, Bombardier, a private jet manufacturer, has a 7 Billion Market cap. Kellog’s, the breakfast-table, ever-present brand, has an 18 Billion Market cap, and Audi, the german luxury auto maker has a 24 Billion market cap. Want to know what fb’s Market Cap is…. around 60 BILLION!! Doesn’t make much sense. Audi made 4,400 Million last year, while fb did 1,000 Million, and actually ran on deficit 2007 and 2008.
Another such nonsense is Nokia’s current valuation. It’s not only my opinion, but also an expert’s opinion that Nokia’s valuation is low. Nokia’s current market cap is just half it’s assets!! It means that the price that the financial world assigns to Nokia is half of the actual “things” Nokia owns, such as “inventory, accounts receivable (money owed to Nokia), plant and equipment, and Nokia’s portfolio of patents.” The article also supports its case by saying that Nokia is doing really well by lining up companies like Rovio and EA Games to make games for the Lumia range of smartphones, and by launching dual-SIM phones with social media capabilities and other high-end features for a low price.
I think they are right, Nokia is doing great. Financially, Nokia is paying for errors done in the past, from the “previous administration” I would dare to say. It will be a little bit longer until Lumia kicks in and starts changing things for Nokia. That range of smartphones is the best thing that happened to Nokia since the N95! Thank Elop.