Home » Technology » Research In Motion Ltd(NASDAQ:BBRY) Slumps On Another Stock Downgrade

Research In Motion Ltd(NASDAQ:BBRY)’s shares slumped 3.40% in early morning session as James Moorman, an analyst at S&P Capital IQ, trimmed his price target on the struggling phone company to $12, representing a potential fall of about 14% from the current price. The firm cited “based on sum-of-the-parts analysis and higher expected cash burn.”

Moorman now projects the company to have a loss of $1.23 in FY2013, compared to his earlier estimate of $1.21. for FY 2014, by 8 cents to a loss of 55 cents; and for FY 2015 by 8 cents, to 11 cents.

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“We are concerned about carrier support for the Z10 U.S. launch, with only 3 of the top 4 carriers selling it,” he writes. “Several new handsets expected to launch this spring and summer could dilute the Z10′s impact. We believe many die-hard users may wait for the Q10 [which has a QWERTY keyboard], which we expect in May or June.”

The stock has been under pressure over the past couple of weeks amid several downgrades. Last week, two analysts had downgraded the stock.

Yesterday, Canaccord Genuity, which has adopted a bearish view of Blackberry, has cut down the handset maker’s sales estimate for its Z10 smartphones by 85 percent to 300,000.

The investment firm had don a channel research of Z10 sales and found that barely a couple of weeks after the launch of the smartphone, the sales momentum had slowed down due to supply constraints.

The Z10 smartphones, which have been released in the United Kingdom and Canada, come with a touchscreen and do not have the trademark keyboard input, which is a hallmark of Blackberry phones.

The phone is not available in the United States until March, a marketing strategy that has not gone down well with the analyst community, who feel that Canadian company has done damage to itself by ignoring the U.S. market at the outset.

Mike Walkley of Canaccord Genuity said that his interactions with wireless carriers indicated that they were cautious about placing orders for the new Blackberry smartphone. He also said that retail stores were showing modest demand.

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4 Responses to “Research In Motion Ltd(NASDAQ:BBRY) Slumps On Another Stock Downgrade”

  1. King BBRY February 20, 2013

    The analysts are doing a poor job with their resrarch. The company plans on launching several devises this year plus the technical side is well above.the.heads.of the folks saying all these poor finding. If everyone would look deeper into what.os in this phone plus all the other technology, they would find that in the UK and Canada that the phones have sold out, there are waitung lists and that BBRY is well a head of the curve tech wise VS it competitors. Please dig deeper and you will see the truth. Also look deeper into.what IBM may do!!

    • Blackberry FTW. February 20, 2013

      I agree with you, I am Canadian and had trouble getting one on launch week. The hardware and software are quite impressive, the only downside is the lack of apps, which I am ultimately okay with. I’m sure the phone will see quite a few copies in the US.

  2. This is the way that I see it: (time to do the math – follow along)

    63 M Population of UK
    35 M Population of Canada
    8 M Population of UAE

    106 M Population of where Z10 was launched (1 phone only)

    World population = 6.98B = 1.5% of the world population where the z10 was available.

    Estimate of Z10 sold in the month of February: 300,000
    Time frame: Under 4 weeks

    If the Z10 was launched world wide, based on the same ratio, there would have been 20 Millions Z10 sold in 1 month. = 60 Million Z10 in a quarter.

    Therefore the analyst that called BBRY to sell 1.75M in under 4 weeks is really saying: BBRY should have sold 116M phones if it launched worldwide in February.

    It does not make sense.


    • rudy de casas February 21, 2013

      The reality is that people get tired of the same old thing(iphone). People want a fresh look and elegant handset. And thats what Blackberry has always been and so much more. Research in Motion get your act together and come out with more innovative apps and you got yourself a buyer. Dont get behind the times. 4 or 5 years ago that was the best phone out there. Theres a new kid in town, and everybody loves you.