Click to Skip Ad
Closing in...

RIM is bloody but not dead yet, RBC says

In a note to investors Friday morning, RBC Capital Markets Managing Director Mike Abramsky lowered his target on shares of RIM stock from $45 to $35 with a Sector Perform rating. Following yesterday’s bloodbath, shares of RIM stock plummeted by as much as 19% after-hours on concerns surrounding RIM’s second-quarter and full-year outlook. The Waterloo, Ontario-based company slashed its full-year EPS outlook from $7.50 to between $5 and $6.50, and it said second-quarter earnings could be as low as $0.75 per share. Abramsky remains cautiously optimistic, however. “Disappointing Q1 results validates prior execution concerns amidst competitive pressures,” he writes. “Although it’s possible RIM fails to turn itself around, that outcome may be premature, we believe, given sustained positives.” The analyst notes 16% year-over-year growth, 68 million total subscribers, service growth and enterprise leadership among the yesterday’s bright spots, and says RIM’s strategy with QNX, TAT-built user interfaces and Android app support “remains sound.” He adds that the impact of BlackBerry 7 devices this fall and then QNX-based handsets, which are expected in the first quarter of 2012, could make RIM an “attractive acquisition candidate.”

Zach Epstein

Zach Epstein has worked in and around ICT for more than 15 years, first in marketing and business development with two private telcos, then as a writer and editor covering business news, consumer electronics and telecommunications. Zach’s work has been quoted by countless top news publications in the US and around the world. He was also recently named one of the world's top-10 “power mobile influencers” by Forbes, as well as one of Inc. Magazine's top-30 Internet of Things experts.

Popular News