Rosenblatt Initiates Nokia With $15 Target on AI Growth

Nokia Corp. (NYSE:NOK) received an initial buy rating and a $15.00 price target from Rosenblatt Securities, with analysts pointing to underappreciated growth in the company's optical networking and artificial intelligence divisions. The target implies a 55% upside from Nokia's trading price of $9.65.

The initiation arrives as traditional telecom equipment vendors seek to position themselves as foundational hardware suppliers for data center operators scaling out large language model infrastructure. According to an Investing.com report, Rosenblatt's valuation framework relies on a sum-of-the-parts methodology that divides value between legacy operations and emerging optical interconnect technology.

Optical Network Expansion and AI Revenue

Nokia's financial metrics point to accelerating demand within specialized enterprise and carrier segments. In the second quarter of 2026, Nokia's Optical Networks division grew 20% year-over-year, while AI and Cloud revenue more than doubled with incoming orders reaching €2.8 billion.

This revenue acceleration is backed by physical manufacturing investments across the United States. Nokia is expanding its Indium Phosphide (InP) laser manufacturing capacity through multiple facilities:

• A San Jose fabrication plant ramping production in the fourth quarter of 2026
• Increased test and packaging operations in Pennsylvania beginning in the third quarter of 2026
• A third U.S. InP fabrication facility located at the NXP Chandler campus

Valuation Methodology and Sum-of-the-Parts Analysis

Rosenblatt's $15.00 price target is derived from a sum-of-the-parts valuation model. The analysis assigns one-third of Nokia's total enterprise valuation to its AI infrastructure and optical components business, with the remaining two-thirds attributed to traditional telecom infrastructure operations.

This structural split reflects a broader market shift where telecom equipment suppliers trade at compressed multiples compared to data center component manufacturers, prompting analysts to parse hardware revenue tied directly to accelerator clusters.