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Canaccord Genuity on Apple, Google, and Nokia


Apple's iPhone is on track to sell 47.5 million units by March, Google just exceeded Microsoft's market cap, and Nokia's smartphones are expected in mid-November.

Nokia (NYSE:NOK ): "Two divided by love, Can only be one, And one is a lonely number." – Grass Roots.

Canaccord Genuity Technology Analyst Michael Walkley's September checks indicated global sales trends remained very weak for Research In Motion (NASDAQ:RIMM) and Nokia. Looking at Nokia, Walkley's global checks indicated weaker Lumia sales given very strong iPhone 5 sales, increased Android competition, and the lack of new Lumia smartphones during Q3/12. He attended the September 5 Nokia and Microsoft joint press conference and was impressed with Nokia's recently launched Windows 8 smartphones including the flagship Lumia 920 and the Lumia 820. However, Walkely believes these smartphones will only be available mid-November and face an extremely competitive smartphone market dominated by the iPhone 5 and numerous LTE Android smartphones.

Further, he was impressed with HTC's recently announced 8X and 8S Windows 8 smartphones expected to launch at 150+ carriers in 50 countries by year end. With Microsoft featuring HTC smartphones in its upcoming ad campaigns, HTC's Windows sales could create increased competition for Nokia's Windows 8 Lumia smartphones. As such, Walkley estimates Nokia will sell 3.8 million Lumia smartphones in the December quarter, significantly below consensus estimates of roughly 7 million units.

Looking at Research In Motion, Walkley views the iPhone 5 launch ahead of BlackBerry 10 devices as a major blow to RIM's potential recovery in C2013 given that Canaccord Genuity's checks indicate strong demand for the iPhone 5 from consumers and enterprises switching from BlackBerry devices. While RIM reported soft but better than expected Q2F13 results last Thursday, his bearish longer-term thesis is unchanged. Given Walkley's checks that indicate weak global BlackBerry sales combined with his expectations for intensifying competition from rival product launches including the iPhone 5 and numerous LTE Android and Windows 8 smartphones ahead of RIM's BB10 launches, he maintains a bearish view on BB10 prospects. Further, his checks indicate increasing competition globally from sub-$200 Android smartphones based on Qualcomm (NASDAQ:QCOM) and MediaTek turnkey platforms. Walkley believes these affordable Android smartphones will increasingly take share from RIM's low-end focused BlackBerry 7 smartphone sales in emerging markets.

Editor's note: For more information on Canaccord Genuity, click here.
No positions in stocks mentioned.
Canaccord Financial and its affiliated companies may have a Corporate Finance or other relationship with the companies mentioned and may trade in any of the Designated  Investments mentioned herein either for their own account or the accounts of their customers, in good faith and in the normal course of market making. The authors have not received, and will not receive, compensation that is directly based upon or linked to one or more specific Corporate Finance activities, or to coverage herein.
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