BlackBerry designer Research In Motion
What Fools say:
Here's how Research In Motion's CAPS rating stacks up against some of its peers and competitors:
|
Market Cap (billions) |
Trailing P/E Ratio |
CAPS Rating |
|
|---|---|---|---|
|
Google |
$171.2 |
37.7 |
*** |
|
Apple |
$154.0 |
36.0 |
**** |
|
Nokia |
$94.4 |
8.4 |
**** |
|
Research In Motion |
$79.3 |
62.4 |
*** |
|
Palm |
$0.7 |
N/A |
* |
Data taken from Motley Fool CAPS and Yahoo! Finance on June 24, 2008.
"To the moon, Alice," says CAPS All-Star salukitrader, who has an outperform rating on the stock. Fellow star player geekdiver counters that with some hard data: "Compare market caps of this stock and Nokia, then compare penetration. Nokia has 10x the penetration but RIMM is within 10% of NOK's market cap."
What management does:
Most companies are happy to see sales growth -- Research In Motion has sales acceleration going on. Gross margins are dropping, but all other important margins are moving in the right direction.
|
12/06 |
3/07 |
6/07 |
9/07 |
12/07 |
3/08 |
|
|---|---|---|---|---|---|---|
|
Gross |
55.1% |
54.6% |
53.6% |
52.5% |
51.6% |
51.3% |
|
Operating |
27% |
26.6% |
26.5% |
27.1% |
27.8% |
28.8% |
|
Net |
17.2% |
20.8% |
20.7% |
20.7% |
21.1% |
21.5% |
|
FCF/Revenue |
1.1% |
15.9% |
16.7% |
13% |
16.3% |
20.4% |
|
Y-O-Y Growth |
12/06 |
3/07 |
6/07 |
9/07 |
12/07 |
3/08 |
|---|---|---|---|---|---|---|
|
Revenue |
39.7% |
47% |
57.6% |
76.3% |
89.6% |
97.9% |
|
Earnings |
31% |
68.6% |
94.9% |
116.5% |
133.1% |
104.9% |
All data courtesy of Capital IQ, a division of Standard & Poor's. Data reflects trailing-12-month performance for the quarters ended in the named months.
One Fool says:
The BlackBerry maker is clearly on a roll right now. That's at least five quarters in a row of increasing sales growth, fueling an almost equally impressive earnings trend and massive cash flows.
But as our CAPS players indicated, there are some massive expectations built into the stock price. The party is simply supposed to go on, fierce competition in a swiftly changing marketplace notwithstanding. Apple's iPhone has raised the bar for what a smartphone can do and what it should cost, and Google may change the game again once its partners start to release Android-based handsets.
We have seen some encouraging signs of a healthy handset market, so I wouldn't be surprised to see the gravy train rolling on a bit further. But keep in mind that buying Research In Motion stock is akin to playing "hot potato" -- at some point, commoditization will burn investors badly. Don't get caught holding the scalding potato at the wrong time.
