Nokia Corporation (NOK): Sinking For Good Reason

Cisco Systems, Inc. (NASDAQ:CSCO) is a giant in the communications equipment industry with a market value over $100 billion. Cisco’s biggest growth avenues of late have been a beefing up of operations via acquisitions – having completed three acquisitions already this month in the cloud computing, data infrastructure and network planning areas. Cisco trades much cheaper than Ericsson on a P/E basis at 10x earnings and also has an impressive gross profit margin of 65%, compared to Ericsson’s 35%. Ray Dalio did however, dump nearly 50% of his stake last quarter (check out Ray Dalio’s other big bets).

Google Inc (NASDAQ:GOOG) owns over 65% of the U.S. search market. Google also has the leading mobile operating system – Android – under its control, not to mention a handset business with the recent acquisition of Motorola Mobility. Of the five stocks listed here, it is easy to guess that Google has the best long-term growth prospects, with a 14% 5-year expected earnings CAGR. Putting this growth into perspective, we see that Google also trades above the other peers at a 22x earnings and 5x sales. Billionaire Ken Fisher – founder of Fisher Asset Management and long-time Forbes columnist – is one of the most committed investors in Google (see Ken Fisher’s big bets).

To recap: we believe that Nokia will continue to see pressures as Apple and Google dominate its market. We like Research In Motion’s potential to resurface as a mid-level mobile carrier, but would be cautious on Nokia. Check out more related coverage below:

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