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 Send to email | Why RIM Is Screwed: Limited Market Opportunity, Losing AT&T Share, Margins Getting Worse (RIMM) in RIMMAAPL |  By Silicon
el 01-Aug-2008 |
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 Is BlackBerry-maker Research In Motion (RIMM) really one of the most promising growth companies in tech, as some bullish analysts have said? Or is its meteoric growth about to hit a wall?
Credit Suisse analyst Kulbinder Garcha thinks the latter, and says he's taken a lot of heat for his "underperform" rating and a $100 price target that's nearly 20% below the $121 it's trading at today.
But in a note today, Garcha repeats his view that the Street's EPS estimate for fiscal 2010 -- $5.41 per share -- is still 18% too high. Why?
- The smartphone market is growing as fast as he thinks it can. He's already predicting the market will accelerate to 64% unit growth in 2009 after 37% growth in 2008.
- RIM's business with AT&T -- 25%-30% of its hardware revenue -- is unsustainable. He thinks RIM's AT&T share -- 70% in the June quarter -- will drop as AT&T focuses extra attention on Apple's (AAPL) new iPhone 3G.
- New business with Verizon won't make up for lost share at AT&T. With the touchscreen 'Thunder' coming this winter, Garcha estimates RIM could get 55% share at Verizon in the December quarter, up from 32% in the March quarter. But that won't offset share loss at AT&T, he says.
- As RIM focuses more on consumers -- their fastest growing segment -- new products are going to put pressure on average sales prices and gross margins. He predicts fiscal 2010 ASPs will decline by 11% and gross margins will fall to 47.6% from 49.7% in fiscal 2009.
See Also:
RIM Getting Beat Up Unfairly, Enough Room For BlackBerry And iPhone, Says RBC
RIM Slapped: Consumer Growth 'Under Siege' Because Of Apple iPhone
Apple's iPhone Enterprise Opportunity "Larger Than Thought," Goldman Says
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| RIM eclipses Windows Mobile market share for Q2 2008 |  Stop the presses and break out the Courvoisier, as we’ve just hit a major milestone in the ongoing mobile OS market share wars. For the first time, RIM and its BlackBerry OS have surpassed Windows Mobile market share during the 2nd quarter of this year. RIM clocked in with 17.4%, handily topping WM’s 12% not [...]
[..] Read complete article | | Published 12-Sep-2008 by Joshua Karp in AppleBlackBerryHandsetsMac OSRIMWindows MobileiPhonemarket share
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 | Nerdblog |  Blogger | Provides news about hardware, software, notebooks, laptops, PCs, Mac, PDAs
Nerdblog.Net |
| AMD market share down in Q4 ‘07 | | Up on the previous quarter, though
AMD may have regained some lost market share between Q3 and Q4 2007, but it was down year on year, the latest figures from market watcher iSuppli reveal.
TheRegister [..] Read complete article | | Published 23-Apr-2008 by Nerdblog in General
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| Stocks Crash, But Still Aren't Cheap. So Steady As She Goes |  From Clusterstock: The DOW dipped below 11,000 this morning for the first time in two years. Worse, the stock market has now been flat for the better part of a decade. Normally, long-term investors would be happy about such events: weakness creates an opportunity. Unfortunately, since stocks were so expensive to begin with, they're still not cheap.
Given the sharpness of [..] Read complete article | | Published 11-Jul-2008 by Silicon in CAPE
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