Dow Jones 10371.80 +68.36 4:33 pm PST, July 5, 2005  NASDAQ 2078.75 +21.38 For info, visit access.smallcapnetwork.com S & P 500 1204.99 +10.55 Change your subscription status here Russell 2000 653.23 +10.19 VOLUME 05: ISSUE 51  Trading Alert: Nokia - The Knockout Punch. There's little doubt that competition in the phone/pda/music/camera device market is particularly vicious. The volatility in the likes of Motorola (NYSE: MOT), Research in Motion (NASDAQ: RIMM) and even Apple (NASDAQ: APPL) is testament to all of the jockeying taking place for the consumers' gizmo dollars. Of all of these players, we currently like Nokia (NYSE: NOK). Synonymous with all things wireless, the shares look compelling for a trade both for technical and fundamental reasons. As well, Nokia is set to launch its N90 series of handsets--although slightly delayed--later this year. Prior to Christmas, the way cool N91 should be out. It's touted to have a 4- gigabit hard drive for music and video, Carl Zeiss optics in the camera/video feature as well as onboard WiFi to connect to computers. Oh yes, and of course a phone. Although Nokia has recently lost some market share to Motorola we feel that as it completes its design changes and focuses its products, the second half could prove interesting for the Finnish behemoth and investors. In a perfect world, we'd buy NOK around $15.50. We feel that accumulating some here and some on dips looks profitable to us in the short-ish to medium-term, depending on your style. NOK is currently trading at its .382 retracement of its recent move up, which is a good entry point to take a shot to the long side. The shares look good to us for a trade right here with a stop at 15.25. That level of stop should give NOK traders plenty of breathing room for the price to get buffeted around, as it seems to be often. The 15.25 stop is well behind the .618 of its recent move up should it decide to trade lower before heading much higher. While the good money will be made in the 6-12 month timeframe, there is likely a decent trade here for those who live in the short-term world. The phone wars are bound to heat up and for our money, as NOK regains some dominance, the market will likely expand its multiple and push the share price higher. And, as MOT's Razor phone is top dog just now, it's share price is likely more vulnerable to disappointing news. Dialing the numbers. In the most recent quarter, NOK reported having $15 billion in cash ($3.36 a share) and a relatively paltry $390 million in debt. As well, earnings projections for 2005 (as at December) and 2006 are $1.09 and $1.24 respectively. While these numbers tend to change slightly--both up and down--the current projected p/e ratios would still be in the 14 to 16 times range--not too expensive-- with the share price at $16.60. By comparison, Motorola's projected p/e for 2006 is currently 17 times. Close enough that it seems that one has no obvious fundamental advantage over the other at this moment. In 2004, 630 million handsets were sold--an all-time high. Handset growth for the next year is expected to increase 10-14 percent, but there are analysts expecting closer to 18 percent. I believe we are fast approaching the point where someone will actually produce an all-in-one gadget that will appeal to consumers. Six months ago, RIMM and Apple could do no wrong. Now, both stocks are well off their recent highs. Both MOT and NOK have been quietly rising.  But as the apparent underdog, we would go with Nokia, as everyone seems to favor Motorola at this point. As we have shown before, 'everyone' is usually wrong. As MOT's RAZR phone helped the once dullard of the sector rise from the dust, so too, we believe, will the N-series wake up Nokia's share price. Back and forth? Sure. Timing is everything. Isn't it always? One of these days I'll do a piece on why a lot of people shouldn't have cell phones. It has to do with low self-esteem issues and misguided feelings of self-importance. But I digress...again.     We Value Your Feedback Got comments, questions or suggestions? Send 'em on over: Editor@smallcapnetwork.com If you wish to send a written request or inquiry, please send it to our physical address: TGR Group, LLC 3525 Del Mar Heights Rd #334 San Diego, CA 92130   Unsubscribe Here D I S C L A I M E R: The SmallCap Digest is an independent electronic publication committed to providing our readers with factual information on selected  publicly traded companies. SmallCap Digest is not a licensed investment professional or broker-dealer. 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