Business Events week of Feb 6th

Went to a few awesome business events this week. On Tuesday, I went to the Dolphin Tank, a friendly pitch-practice event at George Washington University. I got to pitch my idea for the GW business plan comp and hear a bunch of entrepreneurs pitch their ideas. It was really cool to have such a supportive community during the early stages of the startup. At this time, you’re very uncertain and although you believe in your idea, there is always the element of risk.

I’ve never done much public speaking in my life. After London, I’ve been forcing myself to attend as many events as I can where I can develop sales and public speaking skills. I was very happy with my pitch and it went exactly as I imagined. Basically, I practiced for about an hour and a half before hand. I’m a big believer that speeches shouldn’t be memorized, but you should know the flow when you’re up there, so if you stumble you can improvise, but the message is already crafted. Also, when you know it by heart, you can concentrate on how you speak, rather than what you say.

On Thursday, I went to the  “The Social Startup,” an event put on by the GW Office of Entrepreneurship. Basically, DJ Saul, VP of New Ventures at iStrategyLabs, talked about the different types of tools you can use to promote your business on social media platforms. There were many I had never heard of, so the talk was very helpful. He reiterated a recurring theme that everyone seems to be talking about: The merging of the digital and physical worlds.

After the event, he got a few people together and did this exercise where everyone would put their name in a hat and whoever was drawn got to pitch their idea and have everyone give feedback on the idea/help them solve problems they are now facing. I was lucky enough to be randomly chosen and got a lot of awesome advice from everyone on ezEcon. I think I’ve nailed the business model (and figured out a way so that I can adapt it, should it fail). Also, one of the great things about these events is the people you meet. I made some good genuine connections.

Lastly, on Friday, I went to the SEAS Entrepreneurship Club pitch competition. I haven’t heard back yet what the results are, but I’m optimistic. Our five minute pitch was good, and we improved on the business model from when one of the judges last heard it. However, there were some very good and some very interesting ideas, so I guess we’ll see. There were also a lot of people. I think we got in around 7 and didn’t get out until 9:30 ish.

Anyway, these posts are mainly to ensure that I’m honoring my commitment to DO something about my desire to be an entrepreneur. Next week is DC Tech Meetup. I’m excited!

 

Business Events Week of Jan 30th

I went to a two awesome business events last week, both hosted by the George Washington University. One was “The Path to Entrepreneurial Success,” and the other was “Product Development Strategies.”

The first was centered around a talk given by Karen G. Mills, the administrator of the U.S. Small Business Administration. It began with Karen talking about how the SBA can help entrepreneurs through loans, advice, and mentoring programs. Most of the loans seem like they are for low growth brick and mortar type businesses. The mentoring program sounds really awesome though and all of the advice (on business plan, market strategy, etc.) is free! Karen was a wonderful speaker and you can tell she cares a lot about small business growth and innovation. I never realized that the government is actually required to give a portion of their contracts to small businesses with innovative solutions.

There were also two entrepreneurs that spoke who were recipients of SBA loans. One was the founder of promethius, who sold out to blackboard, and the other was the founder of the Wasabi sushi chain restaurant in DC. It was really cool hearing them talk, especially the entrepreneur who founded promethius. He talked about how it all started when he was coding in the basement of Gelman Library (where I am now)  with friends and how he never had a real job.

Overall, I didn’t learn all that much new, but it was neat to see the person behind the scenes running this government organization and realize that she cares about what she does.

The second event, “Product Development Strategies,” was tied to the GW business plan competition (which I entered in and will hear back if I made it into the next round on the 13th). It featured John Funge, the founder of Pickle, Incando Corporation, and Clara Vista. I enjoyed the presentation and it reminded me of the presentations leading up to the business plan competition I participated in while in London.

After the lecture was over, we went around and talked about what we were working on. I got to give my pitch for ezEcon and get some feedback on the idea. It was a lot of fun and I’m already signed up for the next lecture event.

I’m trying to do one business lecture or event every week.

Below, I’ve included the notes that Funge handed out for his presentation:

Product Strategy

It’s not what it can do, what does it need to do.

by John Funge

Some guiding principles

Get to market as soon as you can, but make sure you have a “whole product”

What is “compelling value?”

• For a business –> Rule of thumb: 10x ROI
• For a consumer –> well described in the word “delight”

Do less – better

Get feedback from customers as soon as possible

• Alpha, beta trials
• Sell and meeting with customers before you have your product

Seeing is believing. Make sure you have a great prototype/demo early in the process.

Iterate and be flexible in your product development process.

The basic levers of product management: time, scope, and money.

Be very conscious of your critical path. Parallelize work, optimize your plan around interdependencies.

“Fashion is never finished.” Plan for ongoing product work

Leave plenty of time for testing and quality assurance.

Some tools

Tool 1: The 5 interview process

Tool 2: Competitive Dive

Tool 3: Weighted Criteria Matrix and the 5-step Process Below

Tool 4: Agile methodologies

Tool 5: Project repository (like Basecamp)

Tool 6: Issue tracking tool

5-Step Process to a Roadmap

1. List out all features and functionality (at a feature level – pretty detailed)

2. Evaluate value of different features

3. Evaluate cost

4. Prioritize

5. Repeat often

The five steps are sort of just common sense, but you’d be surprised how often people don’t do the simple things.

Micropost: Facebook IPO Valuation

I hate reading long articles, so I decided to gather a few key facts surrounding the valuation of facebook from the Wallstreet Journal.

Valuation Potential: Between $50 – $100 Billion (and up)

Valuation from private market trading: $81  Billion

Revenue growth

2009 to 20110: 154%

2011:  88%, Profit: 65% growth

2011: 3.71 billion in revenues

Numbers 2011

Net Profit: 1 Billion

Operating Profit: 1.7 billion

EBITDA: 2.1 billion, Projected next year: 4.5 billion.

Google: 10 Billion sales, Valuation of 190 Billion.

LinkedIn: Valued at 30 times estimated cash flow.

I feel like there is so much hype around Facebook that it’s kind of obvious it will be overvalued when the stock is on the market, so I wouldn’t be surprised if it goes up to 30 times revenue. It’s all about future earnings and growth, and I feel like a lot of investors will just throw in with facebook because of the popularity.

This was a really good article. It highlighted some of the obstacles that facebook will face in the coming years that could threaten it’s growth potential.

Article: http://online.wsj.com/article/SB10001424052970204662204577199491268866920.html

 

 

CitySpark Big Ideas Competition: My first business plan competition

The CitySpark Big Ideas Competition at City University was the first business plan competition I’ve ever taken part in. A few weeks ago, I competed in my first business competition. The post can be viewed here. Also, to view the official City University press release, click here.

When I first saw a poster in the hallway for the CitySpark business plan competition, I thought of it largely as being a one time event. I thought you would spend weeks writing up your plan, submit it, and then you would pitch and it would end there. What I soon came to understand is that CitySpark is more than an event, it’s a coaching organization for entrepreneurs, and more importantly, a community.

For those of you who know me, you know I’ve done a fair amount of reading about business. Whether it’s Andrew Carnegie’s Autobiography, Rich Dad Poor Dad, How to Win Friends and Influence People,  or watching hours of interviews of Warren Buffet, Richard Branson, or Felix Dennis, I’ve always sought to learn more about this mysterious world of entrepreneurship. However, nothing compares to the amount of valuable information I’ve gained from the presentations by various CitySpark representatives, entrepreneurs, and investors. Should you decide to enroll in this competition or any business plan competition, take advantage of the presentations leading up to the event! Especially if they bring speakers who have real entrepreneurial experience.

In addition, if you know me, you know that I’m very fond of accomplishing tasks independently and, whether its exercise, school, or writing, take pride that I don’t need a community for motivation or help. If  I can’t accomplish the goal on my own, it means I need to dig deeper, find that hunger, and develop the kind of drive that will sustain me through the bad times. Unfortunately, this kind of mentality isn’t the best for business success. I quickly learned that cooperation and networking are invaluable for getting an idea off the ground.

As an introvert, the idea of “networking” was about as appealing as working the rest of my life for an employer. However, when I began to attend the CitySpark networking events, I was astounded by just how easy it is to talk with other people about business, entrepreneurship, and new ideas. Why? I think it’s simply because when you really are passionate about something, its that much easier to hold a conversation. It’s almost like there was an instant bottom line of rapport because everyone is interested in the same things. It can be very difficult convincing friends to back your business idea or to work for you (in return for equity) for free when they have a different mentality, but when you are with people who have a similar mindset, suddenly an enterprise seems much more possible.

Through the networking events set up by CitySpark, I met my competition partner, and even though I’m going back to America, I know that our business relationship and friendship will continue into the future. Never underestimate the power of being with a group of people with similar interests and similar goals. It’s not about competition, it’s about cooperation!

There is no substitute for meeting real world entrepreneurs. Nothing compares to talking to someone who has literally put his house on the line, used credit cards, all in the pursuit of a dream. You read about these people, but until you attend events like these, you never meet them. Let me just tell you… It’s an extremely powerful experience.

The last thing I want to say about my CitySpark experience is that should you decide to participate, take advantage of the mentor scheme. I was lucky to have an extremely dedicated and at the same time ruthless mentor who honestly criticized our idea, but not to the point where we were discouraged. Sincere feedback is very valuable. Family and friends don’t cut it.

Now, a bit about the competition. Note: this was an executive summary business plan competition, not a full business plan competition. The results? No, I didn’t win. Am I angry? No. Here’s the thing you  need to know about business plan competitions like these… you can do months of work, do everything in your power to demonstrate that there is demand, that there is a target customer niche, that the business model is profitable and sustainable, and that you have advisors and partners who will help get this off the ground, but unless the judges fully understand all of this within the time limit of five minutes AND believe you are passionate about the project, you will not win. Yes, you can be passionate, yes the business might have a high chance of success, but unless you communicate that and they believe it, you will not win.

Also, note that in executive summary competitions like these, the judges may not even read your business plan if they have so many to get through. It’s all about the pitch and your enthusiasm. Have you thought about it a bit and do you have enthusiasm for the project.

So how do you win? Well, this is simple, but it all comes down to what the judges think of your presentation. Unless you communicate in a way the judges like, you won’t win the specific competition. Does that mean your business won’t work? Of course not! You can have the best business plan in the world and maybe in a month you launch the company and it is extremely profitable. Does losing mean you don’t have business aptitude? Not at all! It means you need to work on your presentation skills (unless the judge had a question about the business plan you couldn’t answer, in which case you need to address that). I can’t stress enough that you need to have this mentality when going into one of these competitions.

I am something of an opportunist. I believe that in the long run, business skills and the ability to analyze opportunities is what breeds success. As Felix Dennis says…

“If you never have a single great idea in your life, but become skilled in executing the great ideas of others, you can succeed beyond your wildest dreams. Seek them out and make them work. They do not have to be your ideas. Execution is all in this regard.”

I thoroughly enjoyed this competition. I have learned so much about entrepreneurship and have made invaluable connections. It’s wonderful to be able to meet people my age who have the same goals as myself. Being young, whenever I’ve become doubtful about my future success as an entrepreneur, I  remember that it is the people around me who will be the successes or failures of the next generation. Make sure to surround yourself with people you love working with and who are just as passionate and driven as yourself.

My closing quote also comes from Felix Dennis:

“When the going gets tough, when all seems lost, when partners and luck desert you, when bankruptcy and failure are staring you in the face, all that can sustain you is a fierce compulsion to succeed at any price.”

The London Universities Anglo Sino Rising Star Enterprise Challenge: My first business competition

The “London’s Rising Stars” competition is the first business competition I’ve ever taken part in. It was a seven-hour event that took place during Global Entrepreneurship Week at Portcullis House and the House of Lords (Westminster – Houses of Parliament). Myself and four other team members represented City University. We competed against eight other teams from a variety of schools in the London area. Each team had five to six people and there were around 50 people in total competing at the event. Each of the eight teams was assigned an entrepreneur, two teams per entrepreneur, and each was tasked with developing a marketing strategy for the business’s latest product. These entrepreneurs were a few years out of college and in the initial stages of growing and developing their businesses.

Specifically, my team’s assignment was to take the product, a children’s tourist guidebook of the London area (made by Cupof3, a design & graphics firm), and select the target customer demographic, nationality demographic (of tourists), selling locations, develop a sales and pricing strategy, and identify potential 2012 Olympic Games sales and marketing opportunities. We were given a certain amount of time to compile information from the web and were allowed to leave the building to talk to merchants in the streets. Afterwards, we presented our rough draft strategy to a management consultant, got feedback, and then were given additional time to compile a final presentation for the judges. We then gave our presentation in front of a panel of judges in one of the committee rooms in the House of Lords.

The results? We came in first and were crowned “London’s Rising Stars!”

Having no prior business experience or competition experience, I feel incredibly grateful to have won this title. I think our success is most attributable to three factors.

1. We had an excellent team that worked extremely well together. Forming the marketing strategy was a complete team effort, where everybody contributed ideas and used their strengths to gather information. Had we not worked well together, we would not have been able to compile such a vast amount of market research in such a short a time period.
2. We all had very good ideas about how to market the product to tourists, but I think what distinguished us from our competitors was our ability to take action. We called up businesses, talked with people on the street, compiled statistics, and even bought rival tourist guides in bookshops. It really showed the judges that we had done our homework and that our strategy was grounded in reality.
3. We had a clear and tight presentation. We spoke loudly enough so that everyone could hear and made sure to stay under the allotted time. Compiling the information is important, but communicating it is what seals the deal.

I, along with all the members of my team, was overjoyed. We felt honored to have been up against such stiff competition and grateful that all our hard work had been recognized.

I believe this was the first London’s Rising Stars competition hosted by London Metropolitan University. Despite a few kinks, like not a lot of food and not telling us to bring our laptops, the competition went smoothly and was a rewarding experience. It was wonderful to be able to interact with entrepreneurs only a few years older than myself and have the complete attention of so many successful individuals. If you get the opportunity to participate in this business competition, I highly recommend it! Not only will it hone your business skills, but it’s also a great way to meet individuals with similar interests and goals. As we all know, often times, it’s who you know that can make the road to success an easier path. Just don’t forget to give back, the way these entrepreneurs and business leaders are!

In addition, I treasured hearing Lord Wei speak about the future of business and how China will be an important player in this century. He stressed that every great nation has a great dream (British dream, American dream) and that this century is the time for China’s great dream. The only criticism I had was that in the beginning of his speech, he made is seem like America’s dream was over and that it was now time for China’s dream. Later, he stated how he believed dreams could exist concurrently and that the pursuit of such dreams benefits everyone. I was glad to hear that, because America’s dreams are far from over. In fact, I feel like every day, we are unleashing new waves of creativity and innovation that will make the world better for the next generation. If you need examples, think of Facebook, Apple, and Google. It is my dream to be a part of this entrepreneurial world. Okay, I admit it, I have the startup bug. Thanks London!

European Debt Crisis Cliff Notes

In my struggle to understand what’s happening in Europe and whether or not it is as serious a problem as the media makes it seem (for US financial markets), I discovered two graphics that were extraordinarily useful in giving me a short cliff notes version of the European Debt Crisis developments.

I might write a post later on what I think about the EU Debt Crisis, but for now I’d just like to share these bits of information for Econ nerds who don’t get to read the newspaper that often.

The first gives an overview of the countries in the EU and their general economic condition. It can be found here.

The second gives an overview of the European Debt time line and can be found here

Milton Friedman: Government Spending

I was surfing the internet the other day and came across this youtube video of Nobel Laureate Dr. Milton Friedman talking about why government spending is often inefficient. He proposes a very interesting scenario and for anyone interested in economics or business, it’s worth two minutes of your time.

The diagram below details the  four choices that you can make when spending money. The resulting value (for the intended recipient) and amount spent on the goods or services is described in each box. Friedman suggests that the last box, where you spend someone else’s money on someone else, is how government operates and that this is why government spending is inefficient.

Do you think government spending is inefficient?

The Federal Debt Ceiling

Recently, it seems as though the financial world is tumbling into chaos. From the European  debt crisis to complaints about a sluggish economic recovery, newspapers have been having a field day speculating about the financial horrors that could arise. Most notably, the media has been stirring up fear that the United States will default on its debt and that its credit rating will be downgraded by Moody’s or Standard & Poor’s. Personally, I don’t think anyone is certain about what will happen if the US defaults on its debt payments. If you’ve listened to Warren Buffet’s most recent interview regarding the economy (source), it seems as though the only thing that people can agree upon is that it’s best if we don’t find out what the consequences could be.

I read two articles on the state of the debt ceiling today. One was written by Bettina Wassener and Matthew Saltmarsh and appeared in the New York Times (source). The other was written by Damian Paletta, Carol E. Lee and Matt Phillips and appeared in the Wallstreet Journal (source).  If I had to give an emotion that these articles instill, it would be fear and panic. I’d like to talk a bit about the debt ceiling and what I got from these articles.

For as long as the United States has been a superpower, treasury bonds have been seen as risk free securities and have been the bottom line for interest rates in America and around the world. Interests rates are meant to reflect the amount of risk inherent in an investment. The greater the risk, the greater the interest rate needed to persuade the investor to trade their money for a possibly higher return in the future.

Many economics believe that if the US defaults on its debt and its credit rating is lowered, then interests rates will rise to reflect the perceived risk that comes with loaning the United States money. This would have an impact on mortgage rates and make it more expensive for America to issue new debt. In addition, many speculate that stock prices will drop and that there will be “disruption in the global financial markets.” The credit rating could be downgraded even if the United States continues to pay its interest payments, but fails to make social welfare payments. Treasury Department officials have said that after August 2nd, they will no longer be able to pay government bills. It is no longer about how fundamentally strong the American economy or the American government is. It is now about how strong America appears to be. It is extremely remarkable how much influence the views of Moody’s and Standard & Poor’s have over the financial world.

What is ironic is that by not increasing the $14.29  trillion debt ceiling, the government would be making the deficit worse. A downgrade of our triple A credit rating  would only serve to make borrowing more expensive for us and in the long term, increase our deficit. The question that I keep asking myself is… “What does a triple A rating really mean?”

Robin Marshall, director of investment management at Smith & Williamson in London, asked the question as well. “It raises the question of what is the relevant benchmark?” Mr. Marshall said. “If the U.S. is downgraded, what about Germany, with its increasing liabilities? If you are looking solely at debt-to-G.D.P. levels, you may just be left with countries like Norway, Switzerland and Singapore as triple-A’s.”

S&P has already changed its outlook on America from stable to negative because of the country’s high budget deficit and rising government indebtedness. Does this all mean we are heading for the brink?

Personally, because I favor Warren Buffet’s view of our economic system more than any economist, new reporter, or financial services executive, I think that all of this fear mongering is a “bubble” in the traditional investment sense of the word. Everyone is focusing on how the American economy appears and speculating about the possible calamities rather than analyzing the fundamentals of the American economy. The media is encouraging negative speculation and as public views begin to veer away from hard evidence, the accuracy of those views decreases.

According to the Wallstreet Journal Article, “Moody’s said in a statement that the likelihood of a U.S. default on its interest payments was low, but no longer “de minimis.” It has given the U.S. its highest rating since 1917. ”

This was one line thrown into the center of the article. The rest of the article focused on the horrifying possibilities of a government default. I admit that a failure to pay social welfare payments would cause investors to lose confidence in the short term, but in the long term, the bottom line is whether or not the US can pay principal and interest payments on its debt. It’s not like the US can’t economically make good on its debts, it’s just that the government hasn’t raised an arbitrarily set number to allow the process to occur. Bureaucracy and politics, not business. I’m going to say this even though John McCain was chastised for saying it.  The fundamentals of the economy are strong.

It doesn’t take an genius to realize that failing to raise the debt limit would be pretty stupid and cause negative repercussions, but I don’t think it is as frightening as the media is currently making it out to be. America is a brand. Our brand is one that communicates equal opportunity, rule of law,  private ownership, and a well lubricated system between savers and borrowers. A failure to raise the debt limit would hurt the public’s perceptions of that brand, in the same way that a company’s failure to pay debts or a company’s product recall would hurt the company’s brand. The question is, why risk hurting the brand when the only gain could be assertion of blame on the opposing political party?

Remember, the date to watch for is August 2nd.

Other interesting posts on the debt ceiling:

http://kaystreet.wordpress.com/2011/01/04/the-debt-ceiling-question/#comments

http://olomyvaburi.wordpress.com/2011/07/17/economic-outlook-grim-if-no-debt-deal-reached-ap/

 

Buffet’s View on the Economy (Bloomberg Interview: July 8th)

I wanted to share this video I found on youtube of Buffet’s view on the economy as of July 8th. It’s kind of long, but basically he discusses how housing market relates to unemployment and the possible consequences (or lack thereof) of congress not passing a resolution on the debt ceiling. He also mentions how certain banks are now trading below tangible book value.

 

 

 

Nokia Stock Analysis (NYSE: NOK)

A few weeks ago, I decided that the only way that I’ll be able to tell if I am successful in identifying undervalued companies  is if I record my observations and then, in the future, look back and see whether or not it was a good investment.

I’m selecting Nokia as another stock for value-investing/cigar-butt investing analysis. Keep in mind that the financial information is dated to this post. I will first post the key financial information and then provide a brief analysis.

Key Financial Information

Trading at: $6.32

Book value per share: $5.55

Qrtly earning growth: -1.40%

Cash per share: $4.52

Total current assets: 27,145,000,000

Total current liabilities: 17,540.00

Income Statement – 10 Year Summary (in Millions)

	Sales	EBIT	Depreciation	Total Net Income	EPS	Tax Rate (%)
12/10	42,446.0	1,786.0	1,771.0	1,850.0	0.5	24.8
12/09	40,984.0	962.0	1,784.0	891.0	0.24	72.97
12/08	50,710.0	4,970.0	1,617.0	3,988.0	1.05	21.75
12/07	51,058.0	8,268.0	1,206.0	7,205.0	1.83	18.41
12/06	41,121.0	5,723.0	712.0	4,306.0	1.05	23.71
12/05	34,191.0	4,971.0	712.0	3,616.0	0.83	25.77
12/04	29,371.0	4,705.0	868.0	3,343.0	0.73	30.73
12/03	29,533.0	5,294.0	1,297.0	4,097.0	0.86	32.06
12/02	30,016.0	4,917.0	1,311.0	3,603.0	0.75	30.18
12/01	31,191.0	3,475.0	1,732.0	1,903.0	0.4	34.3

Balance Sheet – 10 Year Summary (in Millions)

	Current Assets	Current Liabilities	Long Term Debt	Shares Outstanding
12/10	39,123.0	24,739.0	4,242.0	3.7 Bil
12/09	35,738.0	22,650.0	4,432.0	3.7 Bil
12/08	39,582.0	25,374.0	861.0	3.7 Bil
12/07	37,599.0	22,826.0	203.0	3.8 Bil
12/06	22,617.0	10,649.0	69.0	4.0 Bil
12/05	22,452.0	10,143.0	21.0	4.2 Bil
12/04	22,669.0	8,438.0	19.0	4.5 Bil
12/03	23,920.0	8,772.0	20.0	4.7 Bil
12/02	23,327.0	9,046.0	187.0	4.8 Bil
12/01	22,427.0	10,222.0	207.0	4.7 Bil

Analysis

I selected this company because it is trading very close to its book value per share. Now, Nokia has been in the news quite a bit lately. Here’s one headline I snagged off of google news “Nokia (NOK) Exits Japan, Cuts Prices On Phones.” Basically, Nokia has been facing stiff competition in the mobile phone/smartphone market. With the advent of new apple products and other smart phone producers, they are having to really compete for consumer dollars. This, along with a slow economy and disruptions in the supply chain set Nokia’s stock at $6.32 per share.

I understand that the competitive environment now is different than in the past, but I’d like to draw your attention to 12/09, when Nokia had 40,984,000,000 in sales,  891,000,000  in net income, and was trading at $12.85 per share. In the latest annual report, it had 42,446,000,000 in sales, 1,850,000,000 in net income, and is now trading at $6.32 per share. The earning power of the company now is very similar to a year ago, and yet the share price is half of what it was.

If you look at the balance sheet comparison between 12/09 and the latest annual report (12/10), you will see that current assets and current liabilities are also proportionally very close.

So, what is driving the price to be half of what it was? Expectations. Expectations that are not based off the intrinsic worth of the company and more so derived from fear.

It is true that the company is facing stiff competition and that they did not have their best quarter/year, but the price at which the marketplace is valuing this company is less than it should be. I view this as being a cigar butt company.  I think that in the short term, as more favorable news is reported on Nokia’s earnings and the economy, the stock price of this company will return at least to $12.00.

One last thing that I want to say about this stock has to due with Nokia’s partnership with Microsoft.

“The marriage of Nokia and Microsoft is official. The smartphone alliance combining the Windows Phone 7 mobile OS from Microsoft with the mobile phone manufacturing muscle of Nokia could be a line in the sand leading to a brighter mobile future for both, or a final desperate swan song” Citation.

For the next two years, Nokia and Microsoft are going to be working every single day to claim market share, cut down on spending, and grow their business back to its original level. Nokia has already replaced management and instated a compensation package that’s tied to shareholder value.  There is definitely a margin of safety with this stock and even a small hiccup in the fortunes of news or earning reports will yield profit. As a final note, I’d like to emphasize that I do not think this is a good business in the long run. However, in the short run, I think that the market will re-evaluate this stock upwards of to at least 10.30 per share, yielding some attractive ROI. In addition, the ~8 percent annual dividend is pretty attractive.

Summary:

Nokia is a bad long term investment, but a good cigar butt stock for the short term.