Interview: Caris & Company
>> we think the market is big enough to support a lot of players. nokia may not be able to get 75% growth in that market but the growth will slow but nonetheless, the market is getting larger and there will be more competitors in the market so we believe they’ll continue to keep a lead because they have a strong operating system that’s used extensively in europe, allowing them to lock in corporations and get the additional buys that the corporations do. we think they’ll continue to keep the lead.
>> let me ask you about the business in the emerging markets for the entry-level phones, the cheaper priced phones. does nokia now sort of ignore or write off or put diminished purpose on this side of their business or is this a concern at all that this has been―you know, that the smart phones outweigh the entry-level phones?
>> well, nokia is a balancing act. every quarter is different. but, no, they want to pursue the emerging markets because it’s so big and growing so rapidly.
>> do they have to put more emphasis on emerging markets ?
>> they have 65% market share in india and india is growing about 120% a year so it’s a market that you don’t want to miss. they actually make money, operating margins, on the $40 phones, they’re completely different than the smart phones, of course. but they have a profitable business in india and they want to make sure they lock in all the entry-level phones so they can get the upgrade business as time goes on. so when i was in india in august, the nokia name was known very well throughout india and although they only have 2% penetration in phones, any kind of phones in india, it’s obviously, with a billion people, it’s a big market .
>> you sound bullish on nokia shares. would you buy right now?
>> oh, yes, i would buy as many nokia shares as i possibly could if i could buy them.
>> if that’s not a ringing endorsement, i know what is.
>> how high do you see them going this year?
>> they have 20% to 25% upside and in our opinion, 25% upside at least in 2006 from here. so we think that they’re very well positioned and the market continues to outgrow expectations. we think the fastest growing area in all of telecom or computers and we think it’s a place you want to play.
>> susan, we’ll have to leave it there. susan kalla, caris & company, appreciate your time.
>> thank you.
>> another day on the witness stand for former enron c.e.o. jeffrey skilling. his latest testimony that he never asked employees to commit crime. details coming up.
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Listen Focus: Insider Trading Scheme
>> two junior employees at merrill lynch and goldman sachs have been charged with running a $6.7 million insider trading scheme. prosecutors say a 23-year-old analyst in merrill’s mergers and acquisitions division gave secret information to a fixed income research associate at goldman as well as another goldman employee. at a news conference in new york, u.s. attorney michael garcia said the defendants were involved in one of the most extensive insider trader cases in this district in decades.
>> what the defendants tried to do was to turn their inside sources of information into an insider trading business. these defendants developed their sources of information in the hopes of running that insider trading business as a money-making machine. for a little while, it worked. netting millions of dollars.
>> according to the complaint, the defendants netted $6.4 million from trading on the merger information. the securities and exchange commission, which filed civil charges against the defendants, says the scheme also involved people tipped off to the information, making trades and sharing profit with the men charged. in his second day of testimony, former enron c.e.o. jeff skilling denied he ordered enron execs to artificially inflate earnings numbers. june grasso has more from the courthouse in houston. what’s the latest from today?
>> there was a shift in the focus of the testimony of skilling today. yesterday, he talked about his background, about his connection to enron, how devastated he was when the company collapsed and his innocence of all charges, generalities. today, it was specifics as his attorney took him through the indictment count by count, line by line at times. the indictment was flashed on a huge screen hovering over the right side of the courtroom and petrocelli, his attorney, asked him questions about it. skilling denied he ever told enron executives to artificially inflate earnings to meet analysts’ estimates. petrocelli took him through specific examples of balance sheets to illustrate that when enron did meet or beat analysts’ estimates it was because of enron’s actual earnings, not because of any fraud. petrocelli asked him, are you smart enough to mastermind this kind of conspiracy and pull it off without getting caught for years? skilling’s answer, i don’t think so, it never crossed my mind. petrocelli tried to show that skilling was already wealthy beyond his wildest dreams. in 1999, he had an estimated worth of $100 million and when he became president of enron, he was entitled to cash in his ownership interest in one of the energy units and he could have cashed that in for $70 million. instead, he cashed it in for $20 million and left $50 million on the table. he said he wanted to set an example and show the board of directors they could trust him with the shareholders’ interests. we expect to see him on the stand for the rest of the week, at least, and then cross examination will begin probably next week. that, of course, is the real test of how his testimony will hold up. back to you, lori.
>> june, thanks for that. in world and national news, now, iran’s president says his country’s enriched uranium. mark crumpton has more.
>> thank you, in a speech in the holy city, mahmoud ahmadinejad said the
