Microsoft vs Nokia

Microsoft and Nokia are two giants in the technology industry, each with a strong presence in the global market. Microsoft, known for its software products and cloud services, has shown steady growth in its stock value over the years. On the other hand, Nokia, once the leader in mobile phone production, has faced challenges in adapting to the changing tech landscape. Investors are closely monitoring the performance of both companies to determine the potential for growth and profitability in the future.

Microsoft or Nokia?

When comparing Microsoft and Nokia, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Microsoft and Nokia.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Microsoft has a dividend yield of 0.72%, while Nokia has a dividend yield of 3.16%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Microsoft reports a 5-year dividend growth of 10.16% year and a payout ratio of 24.70%. On the other hand, Nokia reports a 5-year dividend growth of 0.00% year and a payout ratio of 189.95%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Microsoft P/E ratio at 35.31 and Nokia's P/E ratio at 59.06. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Microsoft P/B ratio is 11.59 while Nokia's P/B ratio is 1.07.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Microsoft has seen a 5-year revenue growth of 0.99%, while Nokia's is -0.02%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Microsoft's ROE at 35.95% and Nokia's ROE at 1.80%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $415.26 for Microsoft and $4.38 for Nokia. Over the past year, Microsoft's prices ranged from $324.39 to $468.35, with a yearly change of 44.38%. Nokia's prices fluctuated between $2.94 and $4.52, with a yearly change of 53.74%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.