“Don’t say you weren’t warned. When Research In Motion failed to impress a jaded Street gang last night, the BlackBerry maker’s stock was taken behind the woodshed for a good old-fashioned beating,” Anders Bylund reports for The Motley Fool.
“The company appears to be gearing up for war. The next-generation Apple iPhone will hit store shelves in a couple of weeks, and Google has handset partners like Motorola and Samsung lined up for the launch of its Android platform a couple of months later,” Bylund reports. “Nokia is nibbling at the BlackBerry’s traditional home field with new models of a corporate-use slant, and Sony Ericsson might jump aboard that Android bandwagon, too. The competition looks ready to launch a massive onslaught…”
“So I don’t think that RIM’s increased [marketing] spending is the real reason for the price drop today, nor do I think the lowered earnings guidance is to blame. Instead, these items were taken as confirmation that the company is readying for a fight — and it’s a battle it might not win. Today’s drop was steep, but the stock still trades at 55 times trailing earnings at prices not seen since late April,” Bylund writes. “It can still fall a lot further…”
Full article here.
“It’s kind of one more entrant into an already very busy space with lots of choice for consumers,” RIM Co-CEO Jim Balsillie said of Apple’s iPhone on February 12, 2007. “But in terms of a sort of a sea-change for BlackBerry, I would think that’s overstating it.”
RIMM is currently trading down $18.83 (-13.23%) at $123.51 per share.
Time to short it.
what exactly IS this iPhone I keep hearing about?
I love my iPhone, I wouldn’t trade it for one million crackberry’s
A RIMM job is indeed what you’ll get if you buy their stock right now. The next year is going to be quite rough for them.
I feel sorry for RIM. I dont know what they are going to do now=)
My company forced me to use a Blackberry. It is utter crap. I still have my iPhone and continue to use it for personal purposes, but hopefully one day they’ll let me use it with Exchange. I’ll never buy a Blackberry – ever.
I would not want to be in RIM management right now….
Eeek!
During the call yesterday, Balsillie did not mention the iPhone directly. When an analyst asked if the company thought its customer base would overlap with the new iPhone, the CEO simply said “Nah.”
http://www.marketwatch.com/news/story/research-motion-shares-fall-disappointing/story.aspx?guid={D774B5D5-E004-4B0F-A9D4-CE14F449782F}&siteid=yhoof
Seems that the investors do not agreed with you.
By not saying the iPhone is a big and real competitor, Balsillie is acting like Motorola’s CEO, Zander. And you know what happened to him.
Comment from the Legs Must Be Crazy in 3. . .2 . .
The Blackberry has the WORST user interface in the world. It is COMPLETELY UNUSABLE and HORRIBLY ILLOGICAL.
…1. RIM is dead. The funeral is July 11th.
Is that what you wanted Ampar?
Meanwhile…. as Nokia scared and extremely worried about loosing its market it is calling all .Net CF developers for a conference on Thursday July 10th 2008…
“Calling Windows Mobile .NET developers! S60 on Symbian is the #1 smartphone platform in the world with over 165 million devices shipped as of March 2008. For Windows Mobile .NET application developers, this is a new market made available by utilizing Red Five Labs (a Symbian Platinum Partner) Net60 SDK and Runtime, which enables existing Windows Mobile .NET CF applications to run on S60 3rd Edition devices. This webinar will summarize the market opportunity available and provide a detailed technical overview of Red Five’s Net60 tools and a case study/example of taking an app from Windows Mobile .NET CF and enabling it on a Nokia S60 3rd Edition device.
Speakers: Eero Kukko, Head of S60 Platform Marketing, Nokia Mike Welham, co-founder & CTO, Red Five Labs
Presentation Time: 60 minutes including Q&A;The webinar will be presented at 9AM Pacific time / 12 noon”
Nice, Crazylegs!
(FWIW, I don’t have a problem with RIM or decent competition.)
…and like a Phoenix out of the ashes will arise a Bold new beginning for RIM…on July 12th when they introduce the unannounced iBerry with a 3.5 inch touchscreen, 3G, GPS, integration with Exchange, MobileMoi, and Mike Lazaridis in a sexy black turtleneck (without questions about his health ’cause he’s got plenty of girth). Oh it’s gonna be sweet!
@Jim Balsillie
Funny how one more entrant from someone who cares…
can turn lots of choice in a crowded market…
into lots of really bad choices in a crowded niche market.
Hope those stock options the Board gave you were to buy High!
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seriously though, hasn’t anyone noticed that Apple recently affirmed RIM’s architecture when they announced the “push notification service” servers and made it a point to say how scalable they are? Isn’t this essentially the same thing as RIM’s NOC?
There has been little written on this topic. I hope they can make these servers perform better than the .Mac service. It seems Apple always is having issues there. Bring it on!
Perhaps it’s just the misanthropic blood running through my veins, but I am truly experiencing Schadenfreude from the likes of RIM, Dell, Microsoft, Sony, and a laundry list of others far too long to bother with listing.
Apple is currently trading down $9.13 …. RIMM .. APPL … both down big time … MDN Magic Word “outside” … where the common man is while the insiders rule the stock market ….
Today whatever the market thinks of RIM it thinks less of Apple.
“Today’s drop was steep, but the stock still trades at 55 times trailing earnings at prices not seen since late April,” Bylund writes. “It can still fall a lot further…”
For reference, at today’s close AAPL trades at only 35x earnings.
RIMM stock definitely has a lot of room to fall, which always does wonders for company morale.
Why is RIMM is down so significantly today? After all, it missed its earnings per share estimate by only $0.01, and while it did lower guidance for next quarter’s earnings per share, it raised guidance for revenue. So why the 13.3% pounding today?
The answer is that for months, investors have rotated out of the crumbling financial and housing sectors and rotated into the technology sector on the idea that technology companies are relatively immune to high oil prices and inflation concerns.
In other words, technology companies — and particularly the leaders, i.e. AAPL, RIMM, GOOG, AMZN and EBAY — became an alluring place to “park” one’s money while waiting for the financial and housing sectors to get their house in order.
(In a similar way, investors have poured money into the commodities market, particularly oil, corn, and precious metals, because they are viewed — incorrectly in my view — as a reliable hedge against weakness in other sectors and inflation pressures.)
So going into the earnings report, there were the regular crowd of shareholders who expected to see RIMM maintain its growth story, plus there were the additional investors who were looking for safe havens for their money.
That’s why the earnings miss of just $0.01 was so devastating — it punctured the myths that each set of investors was telling itself.
[Compare that the previous quarterly results, announced after market close on April 2, 2008, RIMM beat expectations by $0.02 and raised guidance for the (then) forthcoming quarter. The stock responded by jumping from $115.79 (closing price on April 2) to $122.58 (closing price on April 3, one day after reporting its results). This was a net gain of 5.8% in one day.]
So where does RIMM go from here? Probably downwards. Credit Suisse initiated analyst coverage today with an “Underperform” rating and a $100 price target. The stock closed today at $123.46.
Note that AAPL also dropped significantly today, in sympathy with RIMM and also as part of the fallout from today’s meltdown in the financial stocks.
MDN,
Keep the idiotic quotes from the blind mice coming!
As a Canadian, I hate to see RIM doing badly. It would be nice if Rim and Apple takeover the mobile phone arena together and challenge each other to greater heights.
Cripes….can Appl drop ANY lower? Ouch!
Most people still don’t get it.
The Iphone will no doubt be a hot seller, likely surpass RIM for consumer market share but I’m not interested in that. I have to manage, deploy and support thousands of mobile devices and without a BES like solution the Iphone is like comparing an etch a sketch to a laptop. Do you realize how many ActiveSync devices are out there and they all SUCK?! I just had a touch cross my desk and it’s got some nice features but like the ipod I can’t see any of our top tier executives wanting to carry it for actually business use.
This is two totally seperate markets and each have their strengths, MobileMe IS a NOC and the second it has an outage I am going to laugh on “exchange for the rest of us”. Apple .. do yourself a major favor and buy Good server from Motorola, they are doing nothing with it.
Looks like OS 2.0 Beta 5A331 is one of the last builds and it’s pretty close, password policy still isn’t working as you’d expect but it’s basically email wise Windows Mobile similar (they even got the battery drain down).
Did anyone even read the report? They were pretty much on target for their quarter, with the current economy I think other then technofreaks and fanboys you are just not going to see a surge in sales for any electronic device. We have people not able to fill their gas tank, losing homes and job uncertainty.
Grow up.
Buster asks: “Cripes….can Appl drop ANY lower? Ouch!”
Yes, it can fall lower, and it will. Major support for AAPL is around the $165 mark, followed by the $160 level, $150, and $140. (These are approximate.)
In the other direction, resistance is at $180, $190, and of course $200 (near all time highs).
Will AAPL actually get to any of these levels? Anything is possible of course, but given AAPL’s track record, the current price targets, and favorable analyst ratings, I would be surprised if AAPL gets down below $160 or so, given current market conditions. Certainly, most investors would view any dips in AAPL towards the $160 or $150 or $140 levels as a significant buying opportunity.
Looking forward, the next major catalyst for AAPL will be the release of the iPhone on July 11. This will likely result in favorable publicity, along with the usual speed bumps from teething problems (e.g. with activating phones, inventory and stock issues, etc) that may arise.
The next catalyst will be the release of (fiscal) Q3 quarterly earnings, which are scheduled to be reported on July 21, 2008, after market close. The First Call consensus earnings estimate is $1.07 per share (compared to $0.92 one year ago), and consensus revenue estimate of $7.335 billion.
After that, will come Q4 earnings in September, as well as any product launches AAPL conducts in the September/October timeframe to prepare for the Christmas holiday season.
After that will be MacWorld Expo in January 2009, followed shortly by Q1 earnings reported in the third week of Januray 2009.
All of the above is subject to change given unforeseen events. For example, if anything happens to SJ, or if the new iPhone is delayed or if AAPL misses its earnings estimates, then all bets are off. Caveat emptor!