Research In Motion's (NASDAQ:RIMM) BlackBerry personal digital assistant (PDA) may be an essential among the business crowd and techies, but if the average person on the street were asked about it, the response might be something like, "Yeah, I like blackberry jam on my toast." The general public's unfamiliarity with this device can be viewed in one of two ways. It can be a good thing, as it suggests there is plenty of room for growth. It can also be viewed as a negative thing, for there is now a flood of choices for PDAs -- reducing the possibility of consumers flocking to the BlackBerry.

Motley Fool Stock Advisor picks Dell's (NASDAQ:DELL) Axim and Palm's (NASDAQ:PALM) Treo, as well as Hewlett-Packard's (NYSE:HPQ) iPAQ, are a few of the options currently available to those looking for a powerful handheld. Considering this kind of fierce competition, it's easy to assume that the Blackberry is closer to becoming sour rather than ripe.

Yesterday's 9% plunge in Research In Motion's stock price on heavy volume certainly suggests that the market thinks this stock is closer to sour. Investors dumped the stock after the company released its second-quarter earnings report on Wednesday. Let's take a closer look to see whether the market's current view is warranted.

Its second-quarter net revenues were higher by 58% to $490.1 million, compared with the same period a year ago. The bulk of its sales come from its handhelds, which accounted for 70% of its top line growth. RIMM also saw its earnings (excluding one-time charges) increase by 57% to $0.56 per share for the latest quarter.

Although both revenue and earnings were in line with analyst expectations, investors found its subscriber growth disappointing. The company increased its subscriber count by 620,000, which fell at the low end of its original forecast of 620,000 to 650,000. Falling in at the low end was enough for the market to conclude that Research In Motion will face growth challenges ahead.

After the recent 9% downdraft, Research in Motion's stock now trades at 26.8 times FY2006 earnings estimates, which appears reasonable to me -- considering that its current high revenue and earnings growth is more than twice that. However, the market is clearly becoming much more pessimistic regarding the company's growth prospects in the quarters ahead. One positive thing that sellers on Thursday didn't know about was the news late Thursday that the U.S. Patent Office had rejected the patent infringement claims of NTP -- a Virginia-based intellectual property holding company -- against RIM's BlackBerry technology. The pro-Research In Motion ruling could be reversed on appeal, but for now, its business prospects look a little bit brighter than they did on Thursday morning during the worst of the selling.

I will continue to monitor Research In Motion's to see whether it can continue to fend off competitors while increasing its exposure among the "blackberry jam" crowd. No doubt the competition is getting fiercer by the moment, but given its current growth and reasonable valuation, the company still warrants a place on an investor's watch list.

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Palm and Dell are both Motley Fool Stock Advisor recommendations.

Fool contributor Jeremy MacNealy does not own shares of any companies mentioned.