Question of the Week!
QUESTION OF THE WEEK
by RM Group of Richardson GMP
http://dir.richardsongmp.com/the.rmgroup/page_3147
http://dir.richardsongmp.com/the.rmgroup/page_3147
Should I buy Research in Motion?
Without a doubt there are many investors that thought this question would never be asked again as Apple and Android have been eating away at Research in Motion’s market share for a very long time. Let’s be honest, there are many investors that thought Research in Motion (RIM) was dead and would never return to its former glory. While it’s true that the company may never regain its dominant market position, the claim that the company was dead may prove to be premature. Six months ago, most of the discussion about RIM circled around break up, merger and acquisition, and intangible asset valuations. Six months later, much of that talk has disappeared and the market is clearly focused on next week’s launch of the Blackberry 10 device. Yes, that’s right, after years of delays RIM will actually unveil a new device to the market. We could write pages about the "scuttlebutt” on the Street concerning RIM, but when you think about the company’s valuation and thus its future, we think its success will depend on whether or not RIM can regain subscribers that left their Blackberrys over the past three or four years for other devices such as the Apple iPhone or the Samsung Galaxy. Is this dev
ice truly a game changer in this industry that gives the consumer an experience not offered anywhere else? If you think so, then this company has all kinds of potential to regain lost market share which could justify higher valuations. But if not, and the Blackberry 10 does not receive a warm reception, then the recent run up in price will likely be unjustified. We have heard conflicting views on the new device, so it’s difficult to say how easily RIM will attract new and former subscribers onto its platform. As Canadians and consumers, we will hope for the best as it would be great to see a Canadian brand succeed once more, and it never hurts when consumers have choice. What we must make clear is that any investor considering RIM as a stock to buy must realize that its price will likely remain volatile and trading this name is only for those investors with a high risk tolerance.
ice truly a game changer in this industry that gives the consumer an experience not offered anywhere else? If you think so, then this company has all kinds of potential to regain lost market share which could justify higher valuations. But if not, and the Blackberry 10 does not receive a warm reception, then the recent run up in price will likely be unjustified. We have heard conflicting views on the new device, so it’s difficult to say how easily RIM will attract new and former subscribers onto its platform. As Canadians and consumers, we will hope for the best as it would be great to see a Canadian brand succeed once more, and it never hurts when consumers have choice. What we must make clear is that any investor considering RIM as a stock to buy must realize that its price will likely remain volatile and trading this name is only for those investors with a high risk tolerance.
Source: Richardson GMP Limited
The opinions expressed in this report are the opinions of the author and readers should not assume they reflect the opinions or recommendations of Richardson GMP Limited or its affiliates. Assumptions, opinions and estimates constitute the author’s judgment as of the date of this material and are subject to change without notice. We do not warrant the completeness or accuracy of this material, and it should not be relied upon as such. Before acting on any recommendation, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Past performance is not indicative of future results. Richardson GMP Limited is a member of Canadian Investor Protection Fund. Richardson is a trade-mark of James Richardson & Sons, Limited. GMP is a registered trade-mark of GMP Securities L.P. Both used under license by Richardson GMP Limited.
The opinions expressed in this report are the opinions of the author and readers should not assume they reflect the opinions or recommendations of Richardson GMP Limited or its affiliates. Assumptions, opinions and estimates constitute the author’s judgment as of the date of this material and are subject to change without notice. We do not warrant the completeness or accuracy of this material, and it should not be relied upon as such. Before acting on any recommendation, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Past performance is not indicative of future results. Richardson GMP Limited is a member of Canadian Investor Protection Fund. Richardson is a trade-mark of James Richardson & Sons, Limited. GMP is a registered trade-mark of GMP Securities L.P. Both used under license by Richardson GMP Limited.
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