Join        Login             Stock Quote

Research In Motion's Longshot Comeback Effort

 November 27, 2012 02:41 PM

The emergence of Apple's (AAPL) iPhone and Google's (GOOG) Android platforms has radically altered the competitive landscape for mobile phones in recent years. These two players, plus Samsung, now dominate the field. Erstwhile leaders like Research in Motion (RIMM) and Nokia (NOK)  have found themselves marginalized. The chart of smartphone shipments from Asymco:

[Related -Advanced Micro Devices, Inc. (AMD) Reports Today: The Game's Afoot]

Just take a look at this five-year chart tracking the market cap of Apple, Google, RIM and Nokia to see how the market views the sector:

[Related -Boost Your Dividend Yield]

AAPL Market Cap data by YCharts

Yet things can change very quickly in mobile technology and the game may not be over yet for at least RIM. Check out the rip-roaring performance of RIMM, which shot up nearly 3% to $11.98 on Nov. 26 after yet another favorable brokerage write-up.  (The stock is still down about 17% on the year.)

RIMM data by YCharts

CIBC World Markets raised its price target to $17 based on prospects for the company's new BlackBerry 10 operating system ("BB10") debuting on Jan. 30. Jeffries analyst Peter Misek wrote a note to clients, suggesting RIMM had a shot "to become the third smartphone ecosystem or even knock off a weaker Android (manufacturer)."

Here's an overview of BB10 from the BBC:

If the RIMM comeback is real, Josh Brown argues, it could have market-moving implications for the "Apple Victims Support Group."  He's referring to Dell (DELL), Hewlett-Packard (HPQ), and Advanced Micro Devices (AMD), whose share prices have advanced as well lately. In other words, a RIMM revival might signal that Apple isn't untouchable and going to grab 100% of the smartphone/mobile computing market after all.

That said, Brown admits he has no idea of RIMM revival is in the cards or not. Misek thinks the new BlackBerry has a 10% to 30% of reigniting the company's growth.

Tiernan Ray at Barron's threw cold water on the company's chances—while also debunking the case for a turnaround at Nokia. Everyone loves a comeback story, but a RIMM renaissance is still seems like a long shot. On the recent upswing in RIMM and Nokia, Ray says:

I don't think either one stands much of a chance over the long haul; they've simply fallen too far behind Google and Apple and Samsung to ever matter much again, regardless of how good their devices are.

But until the music does stop, such open-ended speculation will likely continue and could probably be good for a trade, at least for a few months.

Covestor Ltd. is a registered investment advisor. Covestor licenses investment strategies from its Model Managers to establish investment models. The commentary here is provided as general and impersonal information and should not be construed as recommendations or advice. Information from Model Managers and third-party sources deemed to be reliable but not guaranteed. Past performance is no guarantee of future results. Transaction histories for Covestor models available upon request. Additional important disclosures available at http://site.covestor.com/help/disclosures. For information about Covestor and its services, go to http://covestor.com or contact Covestor Client Services at (866) 825-3005, x703.



11/27/2012 4:06:01 PM
by dave hargraves
seems to me that Rims new handsets look like apples iphone, that makes competition against apple and android driven devices a very big issue. well good luck Rim you are going to need it. oh well apple and android driven devices designs are wrong anyways including their tablets. regard, Freelance Eng.(designer of smartphone tech)
Rating: (0) (0)
Post Comment -- Login is required to post message
Alert for new comments:
Your email:
Your Website:

rss feed

Latest Stories

article imageAutomating Ourselves To Unemployment

In this current era of central planning, malincentives abound. We raced to frack as fast we could for the read on...

article imageFed: Waiting For June… Or Godot?

The Federal Reserve left interest rates unchanged yesterday, as widely expected. But the possibility of a read on...

article imageThe Single Best Place To Invest Your Money For Retirement

It was never supposed to be this daunting. At least that's what we were read on...

article imageNegative Blowback From Negative Interest Rates

The Federal Reserve is widely expected to leave interest rates unchanged today. But perhaps standing pat read on...

Popular Articles

Daily Sector Scan
Partner Center

Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.