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2-Star Stocks Poised to Plunge: Research In Motion?
Tue, 12/30/2008 - 13:03 by Brian D. Pacampara
Based on the aggregated intelligence of 125,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, BlackBerry maker Research In Motion (Nasdaq: RIMM) has received a distressing two-star ranking. While one-star stocks have been the worst performers, our data has shown that two-star stocks still lag the market by a significant margin and should be approached with caution; conversely, highly rated stocks have outperformed the S&P.
With that in mind, let's take a closer look at Research In Motion's business, and see what CAPS investors are saying about the stock right now.
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Research In Motion facts
| Headquarters (founded) | Waterloo, Canada (1984) |
| Market Cap | $23.1 billion |
| Industry | Communications Equipment |
| TTM Revenue | $9.48 billion |
| Management | Co-CEO James Balsillie |
| Net Income Margin (average, last four quarters and most recent quarter) | 19.2% and 14.2% |
| Competitors | Nokia (NYSE: NOK), |
| CAPS members bearish on RIMM also bearish on: | General Motors (NYSE: GM), |
| CAPS members bullish on RIMM also bullish on: | Apple (Nasdaq: AAPL), |
Sources: Capital IQ (a division of Standard & Poor's), and Motley Fool CAPS. TTM = trailing 12 months.
Over on CAPS, 830 of the 4,788 members who have rated Research In Motion -- or 17.3% -- believe the stock will underperform the S&P 500 going forward. Among All-Stars, fully 38% believe that. The bears include Foliobuilder and WhereIsMyMind.
Earlier this month, Foliobuilder noted that Research In Motion "is trying to sell its products to the consumer, but people aren't rushing out to buy a new $200 phone when their old phone is working just fine. Meanwhile Apple is eating [Research In Motion's] lunch because they have the consumer side and are now encroaching on the enterprise side."
In a pitch just two weeks later, WhereIsMyMind shared that bearish outlook:
"The company is bailing out one of its partners and with competitors at the gates who may be more ferocious than [Research In Motion], I just don't think this company has the teeth to stay in the game. Looking back on their history they could have an ace up their sleeve and just waiting for the right moment to strike, but for now the future looks bleak."
Copyright © 2008 Universal Press Syndicate.