“There are downgrades, and there are downgrades, but I have never seen the kind of downgrade parade marching through Wall Street this morning related to Research in Motion and its stock,” Jim Goldman reports for CNBC.
“The company’s second quarter earnings were disappointing, but RIM’s guidance was downright depressing. Margins will be squeezed, new subscriptions aren’t measuring up, and the sales and marketing expenses appear to be dramatically out of whack as this company tries to sell the variety of new BlackBerrys in its product pipeline,” Goldman reports.
“RIM spent that surprisingly huge $380 million to market all this stuff. And Wall Street is none too pleased. These downgrades this morning are so steep, so strong, so fast that they carry a negative G-force,” Goldman reports. “Cannacord Adams took its target from $185 to $72.50. RBC went from $165 to $90. Credit Suisse went from $100 to $80. These are brutal. RIM shares are in meltdown.”
“How did the Street, indeed so many of us, get this one wrong?” Goldman asks.
MacDailyNews Take: Not reading MacDailyNews frequently enough? Which part of “bloodbath” did you guys not understand?
Goldman continues, “The trouble for analysts and investors: no one knows how RIM will price new products. And when those prices come in far lower than expected, they contribute to earnings misses, kill margins and slash average selling prices. That’s a big problem for companies selling a variety of handsets across a number of smart phone sub-sectors. This indeed could be a harbinger of similar problems for Nokia.”
Goldman reports. “But not Apple. iPhone pricing is set. It doesn’t change until Steve Jobs announces a price change. With iPhone pricing, you know what to expect… If the market is there, and Apple meets or beats iPhone sales projections, today’s sympathy slide with RIM shares could mark a significant opportunity. Again.”
Full article – recommended – here.
[Thanks to MacDailyNews Reader “JES42” for the heads up.]
“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.”
Research in Motion (RIMM) is currently down $23.91, or 24.51%, to $73.62 on heavy volume of 32,537,859 shares.
RIM Shot!
RIP RIM!
RIM rum…
No way I will buy a bb again. Investors should have been wiser when Apple introduced iPhone
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MDN and its readers know better than these anal-ysts. Why aren’t we earning the big bucks??
It is really amazing to see how both the iPod and iPhone have entered crowded market spaces with entrenched leader and just utterly destroyed them. There must be other products that have accomplished this, but I can’t think them.
Unfortunately, Connor, WE don’t drive the market . . . at least not in numbers large enough to really swing things one way or the other. It’s the hedge funds, the insurance funds, the pension funds, et al. that make market in AAPL.
They do bestride the narrow world like a Colossus, and we petty investors walk under their huge legs, peeping about to find ourselves dishonorable graves.
Come on. I’ve never owned a Blackberry and never will. I loves my iPhone but competition is good and RIM is a good company. I don’t want to see them fold, especially in this volatile economic climate.
RIMM job.
If RIMM really had a long-term plan, then there would already be a Blackberry touch-screen device in the market. The iPhone was introduced in January, 2007.
What will Cramer say now? He said the new Bold was the new babe magnet. He really did his homework on that one.
Conner, please. If you know better than the analysts and you’re not making big bucks investing in the stock market, you’re seriously doing something wrong. If you aren’t earning big bucks it’s your own fault.
RIMM shareholders…welcome to the world of AAPL.
I just checked AAPL’s and RIMM’s stock prices before reading this on MDN and it was brutal. AAPL was down by about $6 and RIMM was off by $24. From $148 high just a month or two ago to now $68 – this indeed is a meltdown.
While undergoing serious levels of soul searching both at RIM’s and Streets’ end, someone ought to investigate Cramer (sp?) and street.com as well for possible stock manipulation (harping on and hyping up the darling BB daily). Maybe.
However much I didn’t care for my BB, and gratefully switched to iPhone at the first opportunity last year, I still feel bad for the company. I would rate them higher than all other cellphone players on the market – just nowhere near on the same par as Apple. For a few of us, atleast, that goes without saying.
Wow, MDN MW: trade – as in trade up to iPhone – just to put a positive spin on things.
Wall street lives in their own little world. They see all the huge job losses in their community and they put two and two together – less business guys walking around means less crackberrys walking around. The street looks at Apple in much the same way. What they have not figured out yet is that for every business guy walking around with a crackberry, he has three couch potatoes at home with iPhones. Yes the crackberry is popular and a toyish status symbol for those who wear suits, but in the real world mom, the kids, grandma, all the neighbors and every kid and teacher at school has or wants an iPhone. In most everyday peoples eyes, the crackberry is a symbol of what exactly they do not want to be or be like. Crackberry reaks the old pc world, and that is one world that most of us want to avoid at all costs.
Крвопролиће aka bloodbath
–excerpt from “Bloodbath, around the world”
Serbian rendition courtesy of Predrag
[btw does that also mean ur pre-op?]
mdn MW: field, ie: IN A FIELD OF RED
I also think that by introducing a 99 cent flip phone like all the rest of them, signaled dire desperation on Rims part. Not too smart. Toyota did not bring out a Yugo competitor, they launched the Lexus brand instead as an example to think about.
I wouldn’t be gleeful about RIMM getting beat up. The Street is a den of greedy cut throat bastards who punish anyone not making them exorbitant amounts of money. Making money isn’t enough anymore, and RIMM missed their estimates by a PENNY! What’s happening to real companies with real products is a byproduct of a system out of control.
what you guys fail to see is that unfortunately apple is next. the economy is going to force all companies to take down future guidance out of prudence. good companies can and will have bad stocks. i love AAPL gizmos but thats just reality. good luck..
R.I.M…R.I.P
You’ve never driven a Toyota Yaris, have you.
Classic take MDN! Just please make sure to post headlines when RIM grows massively over the next few years. This is not RIP, it is nothing more than a bump in the road. They still earned $500 million in profits during the quarter, and they expect to earn more next quarter. Contrary to myopic popular belief on this site, BB is here to stay and will prosper.
Classic take Crazylegs!
For far less than $380M ‘marketing stuff’ price tag, I too am willing to share with your enthusiasm. While at it, I’m open for offers from M$ and Google and any other FUD makers du jour. Pay up guys, and I too will flood every mac positive news article with brilliant negative spins – w/o any EXIF data will cost extra.
Trader Joe just got discounted AAPL shares @ $125 and waits for the price hike before/at new notebooks introduction. If the stock rises a meager 20%, Treader Joe will have a free Mac Book.
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My e-mail works.
Good luck with that MobileMe thingie.
@At least,
My sentiments exactly.
RIM has been shown their place.
Which is a niche in the business market. That is all.
That is where they might be able to hold their own, but nothing more.
Downward motion for sure.