Nokia (NOK) Gets Ratings Boost from Bernstein

Sanford Bernstein analyst Pierre Ferragu upgraded the rating of Nokia (NYSE:NOK), saying there’s now more “meaningful upside risk that the company meets investors’ low expectations.”

Ferragu noted that not too many understood the implications over the short term of the deal Nokia made with Microsoft (NASDAQ:MSFT) to use its Windows Phone 7 platform in its smartphones.

“Given the risk of an acceleration of the decline of the company’s market shares and gross margins in the short term,” Ferragu said he remains "very cautious" on the outlook of the company.

Easing some of the pain will be the $1 billion Microsoft will pay Nokia in the deal, which, depending on how it's paid out, could shore up the mobile phone company during the transitional period.

Sanford Bernstein is looking for Nokia to generate EPS of 57 cents in 2011 and 59 cents for 2012.

They have a price target of $7.33 on Nokia’s ADRs. Nokia closed in New York at $8.51, gaining $0.17, or 2.04 percent.

The rating of Nokia was increased from "Underperform" to "Market Perform."