Research In Motion Limited (NASDAQ/RIMM; TSX/RIM) appears to be rising from the ashes, as investors dive back into the stock of the once-fabled maker of the “BlackBerry.” For Research In Motion (RIM), it has been quite the journey after the investment community, including myself, thought the end was near for this former Wall Street star.
But something strange is happening in the equities market, as RIM has surged 168% since trading at $6.43 on September 21, 2012; Apple, on the other hand, has declined 29% in the same period, according to my technical analysis.
My stock analysis shows an opening gap on the RIM stock chart on January 22 on a bullish moving average convergence/divergence (MACD) as indicated by the circles; while this is bullish, be wary of the stock’s overbought condition.
Chart courtesy of www.StockCharts.com
The smartphone and tablet markets continue to be extremely competitive, and I expect this competition will heat up further, based on my stock analysis.
My stock analysis suggests that Apple dominates the tablet market, but there is strong competition from Google Inc.’s (NASDAQ/GOOG) “Nexus” tablet and Samsung Electronics Co. Ltd.’s “Galaxy” series. (Read “Why Apple Needs to Refocus Its Energy.”)
Some believers are also surfacing as RIM gets ready to launch new its new line of devices, powered by its “BlackBerry 10” (BB10) operating system, on January 30. Based on what I have seen that has leaked out on the Internet, the new BlackBerry has the familiar rectangular shape and touch-screen feature of many of the most popular smartphones out there. In addition, RIM has been able to align many of the big carriers to market this product. The company is also looking at licensing out its software, which would be a first for RIM.
According to my stock analysis, the success of the BB10 line will likely be the final opportunity for the company to try to regain market share. RIM will really need to deliver a great product; otherwise, it could be lights out in a few years.
Goldman Sachs is positive on RIM, but then there are the doubters as well, with Canaccord Genuity downgrading the stock to “Sell” from “Hold.”
Overall, the Street is maintaining a cautious tone on RIM. According to Thomson/First Call, four firms rate the stock a “Buy,” with the majority (23 firms) rating it a “Hold.” Eleven firms give RIM an “Underperform” rating, while seven have a “Sell” on the stock.
The question is: can RIM ever regain its former luster? My stock analysis suggests the company has a long and tough road ahead of it. And while it’s unlikely that RIM will catch up to Apple, the best-case scenario would be to take some market share away from Apple and the other big players in this market sector.
All hope lies with the acceptance of RIM’s BB10, based on my stock analysis.
A great product, and RIM could see happier times.