[_StephenBB81]

RIM has roared back despite BlackBerry skeptics -- The Buzz - Mar. 3, 2011

NEW YORK (CNNMoney) -- Coke and Pepsi. McDonald's and Burger King. Wal-Mart and Target. In many industries that cater to consumers, there's a clear number one and a strong number two.

In the still-nascent world of tablets, consumers seem to think that Apple -- with its iPad and recently unveiled iPad 2 -- is the beginning, middle and end of the market.

But investors appear to be betting that BlackBerry maker Research in Motion, whose PlayBook tablet is rumored to be hitting the market in early April, could wind up being the ying to Apple's yang.

Shares of RIM (RIMM) have actually outperformed Apple's this year, despite all the hype about the new iPad and the iPhone launch on the Verizon network. RIM has surged 18% this year, while Apple (AAPL, Fortune 500) shares are up about 11%.

In fact, RIM has soared more than 60% since hitting a 52-week low late last summer. At that time, many investors were growing worried that RIM could be the next Palm, which was forced to sell out to HP (HPQ, Fortune 500) for a mere fraction of what the company used to be worth.

Last August, RIM was suffering from tepid reviews for its Torch phone, which many hoped would be a legitimate competitor to the iPhone. The company had not yet announced its official plans for the PlayBook, prompting chatter that RIM would be left hopelessly behind in the tablet race.

But so much has changed in the past few months. Hopes are building that the PlayBook, like the BlackBerry, will make a big splash with large businesses.

"I still think Apple is going to own the overall tablet market, but RIM is a leading contender to own the corporate market," said Kris Thompson, an analyst with National Bank Financial in Toronto.
iPad 2 is thinner and faster

Thompson estimates that RIM will ship about 3.5 million PlayBooks this year -- and that 1.5 million will go to so-called enterprise customers.

Alkesh Shah, an analyst with Evercore Partners in New York, agreed that RIM has a good chance to take a healthy bite of the growing tablet-market pie.

RIM's acquisition of operating system QNX last year is a significant positive for the company, Shah said. He thinks it will transform RIM from a company that mainly makes e-mail enabled devices to one developing real smartphones.

"Messaging devices were successful up until Apple really created the Internet smartphone market with the iPhone," Shah said. "The QNX operating system on PlayBook, and ultimately on RIM's phones as well, will help the company complete the transition."

Another positive for RIM? It's not Nokia (NOK). The Finnish smartphone maker seems to have replaced RIM on Wall Street's "next Palm" list.
0:00 /2:44iPad 2 first impressions

Nokia announced a partnership with Microsoft (MSFT, Fortune 500) earlier this year that has been almost universally panned. And Nokia has gone a long time without a device that has excited consumers in the United States.

But Peter Misek, an analyst with Jefferies & Co., points out that Nokia still does fairly well abroad. And that's where RIM steps in: Misek believes RIM is in the best position to capitalize overseas on Nokia's turmoil.

"Investors have this myopic view about the market in the U.S. But RIM has really been given a gift with Nokia," Misek said. "It can steal a lot of share in Europe and Latin America."

There are also rumors that RIM may open up some of its apps beyond the insular BlackBerry ecosystem. Tech blog Boy Genius Report hinted Thursday that RIM is working on a BlackBerry Messenger app for Android phones, and eventually for Apple's iOS.

Thompson said such a move would be very smart ... and long overdue.

"It's about time. There are plenty of competing apps to BB Messenger, but they don't do it as well," he said. "Expanding to other operating systems would be fantastic."
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Of course, there's one big glaring risk facing RIM: The PlayBook could flop. It's got a smaller screen than the iPad, and there are scores of Android-enabled flooding the market that match most of the PlayBook's selling points.

But that and other risks may already be priced into the stock. Misek notes that even though many analysts are skeptical about RIM's strategy, their earnings estimates have risen sharply in the past few months.

RIM will report its latest quarterly results on March 24. Analysts expect a profit of $1.75 a share. Three months ago, the consensus estimate was for $1.61 a share.

The stock also trades at a dirt-cheap price of only 10 times earnings estimates for the current fiscal year, which ends in February 2012.

"There is more upside for the stock," Shah said.

He thinks that investors are making a big mistake if they assume that the market is only big enough for that little company in Cupertino, Calif.

"This is not a case of 'will Apple win' or 'will RIM win,'" he said. "Apple is great, but there is room for multiple vendors. Right now, the mobile market is getting bigger at a fast enough rate that many companies can benefit."

I figured I'd post a blog post from CNNMoney about RIM, we get a lot of nay sayers, this guy isn't one of them

[lnichols]

Were they ever in the red is the question, and I think the answer is no despite RiM's many critics/"creditors" on this board.

[missing_K-W]

Were they ever in the red is the question, and I think the answer is no despite RiM's many critics/"creditors" on this board. Maybe this will disrupt the "Dutch" tended stock exchange, but who the **** cares about the dutch anyways :-)

It's only a matter of time before RIM has a market cap of 100 billion....QNX cornering the market with it's capabilities and support....not to mention the release of other QNX peripherals

Posted from my CrackBerry at wapforums.crackberry.com

[Ferretling]

Alkesh Shah doesn't think RIM makes "real" smartphones. I want to know what planet he's from.

[qbnkelt]

Thank you for posting an alternate view. It won't do any good towards giving the doom and gloomers a reality check, but it's nice to see some balance in the articles on the forum.

[red777]

Wait a minute! Some people were saying that RIM was a sinking ship and had two years left until they closed up shop. You mean to tell me that these stupid statements that people were and are making are wrong?

Posted from my CrackBerry at wapforums.crackberry.com

[CranBerry413]

You know, I read this article a few days ago on the CNN Money site, and I wasn't really shocked at what they are saying. I keep imagining that there is some sort of disconnect between what's real and what's fake.

People think that Google Phones and Apple Phones are killing BlackBerries, and it just isn't the case.

Posted from my CrackBerry at wapforums.crackberry.com

[i7guy]

^^^^ While nobody can predict the future and as we know management is not infallible, each platform will have it's supporters and detractors. RIM just happens to have a group of vocal detractors.

[red777]

Alkesh Shah doesn't think RIM makes "real" smartphones. I want to know what planet he's from.

Probably because you can't play angry birds on a Blackberry.

Posted from my CrackBerry at wapforums.crackberry.com

[webdave]

Probably because you can't play angry birds on a Blackberry.

Posted from my CrackBerry at wapforums.crackberry.com

That made me laugh

[breakmedown]

"He thinks that investors are making a big mistake if they assume that the market is only big enough for that little company in Cupertino, Calif.

"This is not a case of 'will Apple win' or 'will RIM win,'" he said. "Apple is great, but there is room for multiple vendors. Right now, the mobile market is getting bigger at a fast enough rate that many companies can benefit." "


I think that's the main thing that the "nay sayers" tend to forget. Yes, Android powered phone sales are way way up. So are smartphone sales overall and in general. So to say that because they're losing market share means that they're losing everything is ridiculous.

I could see where RIM would become a niche market, but it will never be something like Palm, just because of the security and corporate adoption right now.