Nokia has been selected by BT, the UK’s biggest mobile operator, as a supplier for 5G radio access network (RAN) equipment.
As a result of the deal, Nokia (NOK) will become BT’s largest infrastructure partner and supply equipment and services at BT radio sites across the UK. Currently BT powers Nokia network in Greater London, the Midlands and rural locations. With this deal, the reach will be extended to also cover multiple other towns and cities across the UK. Financial terms of the deal weren’t disclosed.
“I am delighted that BT has extended its partnership with Nokia on 5G RAN, making Nokia BT’s largest infrastructure partner,” said Nokia CEO Pekka Lundmark. “Our two companies have collaborated for over a quarter of a century in order to deliver best-in-class connectivity to people across the United Kingdom. We are proud to support BT’s 5G network evolution.”
Nokia will supply its AirScale Single RAN (S-RAN) portfolio for both indoor and outdoor coverage, including 5G RAN, AirScale base stations and Nokia AirScale radio access products. The deal will also see Nokia optimize BT’s 2G and 4G networks and work alongside BT on the development of the OpenRAN ecosystem.
Shares in the Finnish telecom firm have lost 21% over the past month after Verizon replaced the company as its 5G supplier in the US and chose Samsung as one of its main suppliers of radio equipment. On a year-to-date basis, the stock is up 4.9%. With an average price target of $5.19, analysts forecast upside of 33% over the next year.
Northland analyst Tim Savageaux, who has a Buy rating on the stock with a Street high $6.50 price target (67% upside potential), said recently that he believes that the “degree of concern around NOK prospects at VZ are overdone”.
The analyst points out that Nokia’s recent entry into the Data Center switch market presents a sound opportunity and “serves as a timely reminder of the breadth and depth of NOK technology capabilities beyond wireless.”
“While we continue to find NOK shares compelling from a sum of parts perspective, given the positive impact of increased traffic demands across the company’s IP/Optical and Fixed Access segments, we also find the stand alone fundamental story compelling,” he summed up.
The rest of the Street is cautiously optimistic on the stock. The Moderate Buy analyst consensus shows 3 Buys versus 4 Holds. (See Nokia stock analysis on TipRanks)
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