Nokia stock has waited in the bullpen for years. Now, it may finally get the catalyst needed for a triple-digit rage. The Nokia stock forecast for 2025 is $10, more than double what it is today.
And this is happening sooner than later...
The Finnish telecom fell with the best of them in the 2020 COVID-19 crash, down near $3. Its growth couldn't match the broad market rally in the months that followed, though it did regain some footing in the $5 range.
Nokia almost hit $7 when the Robinhood craze came about in January 2021. Those were levels unseen in the last decade.
Well, it's about to do it again. And this time, it's going even further.
Nokia was also one of the "meme stocks" making headlines alongside GameStop Corp. (NYSE: GME) and AMC Entertainment Holdings Inc. (NYSE: AMC). Hedge funds that were short on the stock were put in a difficult "squeeze" position where they had to buy back shares for more than they sold them.
However, some traders were unable to buy in as Nokia was among the stocks for which Robinhood controversially paused trading.
Now that the hype has mostly faded, we still have a solid $4.91 Nokia stock price, steadily climbing toward the previous $5 analyst target.
Two big market stories will move the Nokia stock price over the next decade. The rise of the Robinhood trader will continue to play a role. And 5G will start to show the results we've all been waiting for.
But one could make it a buy immediately.
Nokia's 5G Is Catching On
Probably the biggest driver of the Nokia stock price is future 5G hopes. According to Allied Market Research, the 5G market could rise to $667 billion by 2026, which will have been a 1,526% rise from its 2020 value. Nokia could gain a significant portion of that.
We said in our 2021 Nokia stock forecast that the company would have to edge out a few of its global competitors to do this - China's Huawei and Sweden's Ericsson.
While both companies are larger than Nokia, it looks like Nokia stands a chance against them both, as predicted in our 2021 Nokia stock price prediction.
Nokia was initially poised to get beat up by these larger rivals. But its biggest enemy in this regard was itself.
The company had internal development problems stemming from an attempt to build a one-size-fits-all chipset. It ended up being more expensive to build than a custom chip, so it flopped.
But Nokia did not back down. It enlisted Marvell Technology Group Ltd. (NASDAQ: MRVL) to develop a better chipset. Since then, the company has been steadily phasing out the faulty chipsets for the good ones.
Now, its success hinges on beating other tech giants.
Fortunately, various countries in the European Union have been tightening their 5G security laws to keep Huawei out. This opens the market for Nokia significantly.
Already, the U.K., Poland, Germany, and other countries have taken steps to ban Huawei technology. Germany is the latest to do so with its "IT Security Law 2.0" restricting the role of "untrustworthy" 5G technology suppliers.
The anti-Huawei sentiment is still projected to increase across the continent.
Nokia is also making moves in Sweden, home of Ericsson. It was just selected by Net4Mobility for 5G expansion in a five-year deal. The plan is to upgrade Net4Mobility's existing 4G radio network while adding a 5G layer using Nokia's platform.
This is great for Nokia's momentum in Europe. Net4Mobility is Sweden's largest RAN network, carrying 60% of the country's network traffic. For 4G alone, it covers 90% of the country.
Nokia will continue to try and improve legacy 4G systems and push the ultra-fast speeds of 5G through its products. It creates a positive outlook for the next five years.
Given all these latest developments, here is our Nokia stock forecast for 2025.
Nokia Price Prediction for 2025
The broad market, the 5G market, and Nokia's product will still serve as three key drivers of the Nokia stock price leading up to 2025.
For the broad market, the S&P 500 has ripped upward 57% since the pandemic slump. The economy is reopening further as people around the world get vaccinated.
Retail trading is alive and well as more Robinhood-like apps such as e-Toro, WeBull, Stash, and CashApp give retail investors easy access to stocks. Increased trading volumes could drive up stock prices.
$1.4 Trillion 5G Aftershock
5G is creating a $1.4 trillion aftershock market - and 20 small companies could produce 10X gains by the end of the year.
$1.4 Trillion 5G Aftershock
5G is creating a $1.4 trillion aftershock market - and 20 small companies could produce 10X gains by the end of this year.
Meanwhile, the 5G market will beam up as well, nearing that prediction from Allied Market Research in 2026. We have yet to experience the biggest boom from 5G phones and carriers as they become more widely available.
What's more, we are yet to see how 5G can impact other areas of life such as autonomous vehicles, smart homes, the medical field, and more. All of these areas expect to undergo drastic change with new Internet speeds up to 100 times faster than we have today.
Right now, the benefits of this are hard to imagine, but we will be closer to that in five years.
Finally, Nokia has gotten over the hump with its product issues and continues to roll out its products and services around the world. This bodes well for the company financially, and it will reward investors in turn.
Last year, Nokia said that it would resume dividend payments if the company could get its net cash up from $1.5 billion to $2 billion. We will see on its next earnings report whether or not it is headed in that direction.
If Nokia is set to resume dividend payments, you want to get in before that happens. That's when a wave of dividend investors will flood back into Nokia. They will also be hoping for solid growth.
All in all, Nokia stock presents solid growth potential for anyone interested in profiting from 5G over the next decade. They will likely collect a regular dividend as well.
Expect this one to pass $10 by 2025.
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About the Author
Mike Stenger, Associate Editor for Money Morning at Money Map Press, graduated from the Perdue School of Business at Salisbury University. He has combined his degree in Economics with an interest in emerging technologies by finding where tech and finance overlap. Today, he studies the cybersecurity sector, AI, streaming, and the Cloud.