BBRY - BlackBerry (old RIMM) - Page 152
- April 30, 2012, 10:39 A.M. ET
RIMM Gains On New BlackBerry 10 Rumors, Analysts Skeptical
By Teresa Rivas
Shares of Research in Motion (RIMM) were moving up 2.4% in recent trading, as multiple sources are reporting that the firm may announce the first BlackBerry 10 phone by mid-August with an October launch, just in time for the start of the holiday season.
Tomorrow, CEO Thorsten Heins will unveil a pre-beta version of the firm’s BlackBerry 10 operating system on a working prototype touchscreen device.
Still, some analysts remain skeptical of the stock, which has run up nearly 15% since its December lows.
FBR Capital Markets analyst Scott Thomson reiterated his Underperform rating and $11 price target on the stock, writing “We believe much of the stock’s appreciation in recent weeks has been in anticipation of this event; however, we urge investors to remain cautious as the most challenging portion of RIM’s turnaround may be ahead. RIM continues to struggle as the company remains focused on pushing through a difficult product transition and we expect the quarter could yield another difficult result. Management stopped giving quantitative guidance and braced investors for a protracted and difficult transition. We expect this transition will continue well past the release of RIM’s initial device expected this fall.”
More bad news but it trends higher... musical chairs?
4/30/2012 @ 1:39PM |1,099 views
Research In Motion: RBC Cuts Ests On Continuing Share Loss
RBC Capital analyst Mark Sue this morning trimmed his financial forecasts for Research In Motion to reflect the BlackBerry maker’s continued market share losses.
Sue now sees revenue for the February 2013 fiscal year of $13.7 billion, down from a previous projection of $14.9 billion, with profits of 96 cents a share, down from $1.95. Street consensus is for $15.3 billion and $1.95.
“With supply chain data showing a backup to RIM’s products we’re reducing our unit estimate for the current quarter,” he writes in a research note. “In the ever competitive smartphone market, Nokia, RIM, Motorola, Sony, LG, and a slew of others are donating market share while Samsung and Apple continue to gain market share. For the quarter ending in May we’re now estimating 9 million units vs. the consensus of 10.5M units and RIM may soon be in danger of dipping below 5% global market share. Limited scale at that point can lead to shrinking operating margins and in our worst case scenario RIM may burn cash next year. The good news is that RIM has no debt.”
Sue thinks that even RIM’s core enterprise market is now at risk as the bring your own device trend continues to gain ground. “RIM is resorting to price cuts to boost sell-through, but that many not be enough to stem the tide, in our view,” he writes.
Sue keeps his Sector Perform rating and $13 target price on the stock.
RIMM is up 41 cents, or 2.9%, to $14.44.