- Research In Motion lost 22 per cent on the TSX on Friday � plunging to the lowest level in five years � as investors responded to slower BlackBerry sales and analyst downgrades.
The Waterloo, Ont.-based company's stock sank $7.55 on the Toronto Stock Exchange, trading at $26.82 with more than nine million shares traded by midmorning Friday � making it the second-most active issue on Canada's largest market. RIM shares haven't been below $30 on a split-adjusted basis since August 2006.
RIM faced a rocky day on the stock markets after the company posted disappointing earnings after North American markets closed on Thursday. Friday was the first chance for investors to react to the poor showing.
Jarislowsky Fraser Ltd., the fourth-largest holder of RIM shares after co-CEOs Jim Balsillie and Mike Lazaridis, revealed Friday that it had sold off half of its RIM holdings.
The money management firm owned more than 10.2 million shares � enough for almost two per cent of the company. Chairman Stephen Jarislowsky confirmed the firm had sold off more than 50 per cent.
"They are resting on their laurels. Steve Jobs is a much better marketer than RIM," Jarislowsky told Bloomberg, referring to Apple�s chief executive officer Steve Jobs, who is perceived to have his finger on the pulse of what consumers want.
National Bank Financial said BlackBerry handsets sales were worse in the company's first quarter than anticipated and guidance for the current quarter and fiscal year was "very weak."
"We're lowering our estimates significantly," wrote National Bank analyst Kris Thompson.
"We believe the smartphone sector is moving into a new paradigm of lower margin pricing as Android handsets attack the high, mid and low-end market segments. We do not expect the company's gross margins to rebound."
National Bank Financial lowered its price target for RIM stock to $25 US per share and maintained its underperform rating.
"We do not expect the stock to trade on meaningful valuation metrics given the uncertainty in the company's operating model. We'd avoid this stock until there is some evidence that a sustainable turnaround is achievable," Thompson wrote.
On Thursday, RIM said it earned $695 million US or $1.33 per diluted share for the quarter ended May 28 on $4.91 billion in revenue. That compared with a profit of $769 million or $1.38 per diluted share a year ago on $4.24 billion in revenue.
RIM had lowered its financial guidance for the quarter in April.
Before those numbers came out, the consensus call for the company was $45 per share.
Research In Motion said Thursday it plans to cut jobs as it works to roll out a new generation of products to stay competitive. RIM did not provide any details on where those job cuts might come from, or how many there may be, when asked for comment by CBC News Friday.
Sorry if this has been posted already, just wanted to share the news and I did search.06-17-11 01:00 PMLike 0 - Source: RIM shares plunge 22% - Business - CBC News
Sorry if this has been posted already, just wanted to share the news and I did search.06-17-11 01:15 PMLike 0 -
Posted from my CrackBerry at wapforums.crackberry.com06-17-11 01:45 PMLike 0 -
Bottom line is yes, they've let some people go. So has my company, and we were never in any danger of going under. We're nowhere near the giant that RIM is, we did it because we figured out we had a few instances where a job that only needed one or two people had more than the necessary requirement.
Posted from my CrackBerry at wapforums.crackberry.com06-17-11 04:12 PMLike 0 - for sure man, it mean it's not the four horsemen riding in, but a major investor dumping all their shares... well that's just awful, and it doesn't mean they're done, but if you were writing the story of a company's demise that's where you'd start right? it's scary because RIM is at a point in time where they need money and phones. there has never been a more dire time in the company's history to put phones out that compete with the market, and if investors are bailing and they're laying people off it just makes me wonder if they even have the resources in R&D to play this scenario out.06-17-11 04:18 PMLike 0
- for sure man, it mean it's not the four horsemen riding in, but a major investor dumping all their shares... well that's just awful, and it doesn't mean they're done, but if you were writing the story of a company's demise that's where you'd start right? it's scary because RIM is at a point in time where they need money and phones. there has never been a more dire time in the company's history to put phones out that compete with the market, and if investors are bailing and they're laying people off it just makes me wonder if they even have the resources in R&D to play this scenario out.
Posted from my CrackBerry at wapforums.crackberry.com06-17-11 06:04 PMLike 0 - How many companies have survived this kind of fall so quickly, intact? Not many i'd wager. Only the bell saved them yesterday. Come Monday it could continue.06-17-11 06:12 PMLike 0
-
Edit: and who can forget Apple a few years back? And MS?
Posted from my CrackBerry at wapforums.crackberry.com06-17-11 06:22 PMLike 0 -
M$ and Apple never lost 22% in two days did they?06-17-11 06:26 PMLike 0 -
Hayward now, he got canned for setting up an environmental disaster; RIM simply let a few people go. But as the case is with RIM, if someone there sneezes people start reporting that the employees are diseased and it's the end of RIM, etc, so investors jumping because a few employees were let go is the cause of the hubbub. Not the resulting 22% slide.
Posted from my CrackBerry at wapforums.crackberry.com06-17-11 06:39 PMLike 0 -
- sleepngbearRetired ModeratorInteresting comparison there. Apple's woes came when they canned their visionary original leader, while RIM's are happening at hands of theirs. Say what you want about Jobs, but this comparison speaks volumes about the differences in the abilities of leadership of both companies. Yes, M & J have done a marvelous job bringing RIM to the point that they have. But many of the things they are saying now make you seriously question whether they understand the gravity of their current situation. I'm a little less optimistic these days, but no less hopeful.06-19-11 01:47 AMLike 0
- Forum
- Popular at CrackBerry
- General BlackBerry News, Discussion & Rumors
RIM Shares Plunge 22%
LINK TO POST COPIED TO CLIPBOARD