Apocalypse Now? Not Quite, Nokia Corporation (ADR) (NOK)

The Windows master plan

Nokia Corporation (ADR) (NYSE:NOK) CEO Stephen Elop said in 2011, when he announced that Nokia was dropping its native Symbian OS for Windows Phone, that it would probably take about two years for Nokia and Windows as an alliance to take hold. Well, the two-year mark will arrive with the next earnings report in July. The numbers here seem to indicate a positive trajectory, but this next quarter has to see some real growth – especially with the Windows handsets – for Elop to be truly prescient. And perhaps still be employed in Finland.

What can investors do?

From a valuation standpoint, shares of Nokia trade at bargain bin sales and cash flow multiples of 0.3 and 0.9, respectively. The massive dividend yield near 8% is icing on the cake. Microsoft Corporation (NASDAQ:MSFT), meanwhile, sports higher price-to-sales (3.3) and price-to-cash flow (3.5) metrics, and has a dividend less than half that of Nokia Corporation (ADR) (NYSE:NOK).

Smartphone peer Research In Motion Ltd (NASDAQ:BBRY) is also nearly twice as expensive on the revenue side, and it doesn’t offer one cent of dividend payments to its shareholders. Analysts may argue on the long-term viability of its Z10 and Q10 series—especially against future iterations of Nokia’s Lumia—it’s really up in the air.

When pressed to choose, it’s conceivable for some to go with Nokia because of its cheapness relative to its peers in the smartphone space. Sure, the yield’s a bit bloated from the stock’s latest sell-off, but it’s quite possible that if turnaround-focused investors are correct about this stock, even in the short run, value and income bulls will follow suit over the longer run.

Don’t forget, Nokia also has one heck of a patent portfolio—about 10,000 strong. To read more about it, check out our extensive coverage on Insider Monkey.

The article Apocalypse Now? Not Quite, Nokia originally appeared on Fool.com.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.