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2-Star Stocks Poised to Plunge: Research In Motion?

By Brian D. Pacampara, CFA - Updated Apr 5, 2017 at 7:53PM

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Market-lagging returns could be written in this 2-Star.

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.

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
Co-Founder/Co-CEO Michael Lazaridis

Net Income Margin (average, last four quarters and most recent quarter)

19.2% and 14.2%

Competitors

Nokia (NYSE:NOK),
Motorola (NYSE:MOT)

CAPS members bearish on RIMM also bearish on:

General Motors (NYSE:GM),
First Solar (NASDAQ:FSLR)

CAPS members bullish on RIMM also bullish on:

Apple (NASDAQ:AAPL),
Google (NASDAQ:GOOG)

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."

What do you think about Research In Motion, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 125,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Nokia is a Motley Fool Inside Value pick, Apple is a Stock Advisor selection, and Google is a choice of Rule Breakers. The Fool's disclosure policy always gets a perfect score.

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Stocks Mentioned

BlackBerry Stock Quote
BlackBerry
BB
$6.86 (1.18%) $0.08
Alphabet Inc. Stock Quote
Alphabet Inc.
GOOGL
$122.08 (0.33%) $0.40
Apple Inc. Stock Quote
Apple Inc.
AAPL
$173.19 (0.63%) $1.09
Nokia Corporation Stock Quote
Nokia Corporation
NOK
$5.11 (-1.92%) $0.10
First Solar, Inc. Stock Quote
First Solar, Inc.
FSLR
$118.22 (0.22%) $0.26
General Motors Company Stock Quote
General Motors Company
GM
$39.40 (-0.20%) $0.08
Motorola Solutions, Inc. Stock Quote
Motorola Solutions, Inc.
MSI
$255.37 (-0.23%) $0.60

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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