Nokia has returned to investor favor since the market recognized the group's position within the artificial intelligence value chain. This morning's continued rally is fueled by Cisco's 20% surge in after-hours trading last night.

The American competitor reported earnings and orders that exceeded expectations, accompanied by several impactful statements. Most notably, the company highlighted a 152% increase in orders for artificial intelligence infrastructure. 'Nokia competes with Cisco in the router, switch, and pluggable transceiver segments, and Cisco's solid outlook for both orders and sales is also positive for Nokia's prospects,' explains Jefferies tech specialist William Beavington. The analyst also notes that the visible strengthening of orders in the telecommunications segment is a new development and 'particularly positive' for Nokia.

Part of the journey is already complete

Two weeks ago, Beavington shared an insight that resonated deeply with the market. 'We believe Nokia is currently in the same situation ASML faced around December,' he explained at the time. Since then, the stock has gained more than 20%, surpassing €13, which brings it closer to Jefferies' 'bull case' valuation of €14.2. Nevertheless, the analyst remains positive, judging that earnings should grow beyond market expectations in the coming months.