Please ensure Javascript is enabled for purposes of website accessibility

RIM's Riding the Storm Out

By Anders Bylund – Updated Apr 6, 2017 at 1:47AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

A nice, juicy report sinks RIM's stock? What can you do but shrug and enjoy the discounted shares?

The deluge of happy telecom news has started in earnest.

BlackBerry maker Research In Motion (NASDAQ:RIMM) reported first-quarter adjusted earnings of $0.98 per share on $3.4 billion in GAAP revenue. 3.8 million net new BlackBerry service accounts were added in the quarter for a total of 28.5 million users worldwide.

Cheery reports from the semiconductor chip makers in the last couple of weeks had led me to expect good news from RIM. The Canadians didn't disappoint. Sales ticked up by 53% from the year-ago period and the bottom line outperformed management's guidance range of $0.88 to $0.97 per share.

It wasn't a mind-blowing outperformance by any means, but the report still qualifies as seriously good news. It takes a special business to perform this well amid a storm of new and upcoming competition from well-heeled and respectable rivals.

Everyone is launching fancy new smartphone models right about now, including the eagerly anticipated next-generation Apple (NASDAQ:AAPL) iPhone 3GS, the fandom-inducing Palm (NASDAQ:PALM) Pre, and upcoming Android phones with Google (NASDAQ:GOOG) logos on their Samsung and HTC shells. The deluge of new competition in combination with the rickety economy was not enough to derail RIM's gravy train in the slightest.

RIM is throwing an updated BlackBerry Storm into the fray before the holidays, alongside the all-new BlackBerry Tour smartphone launching this summer. Verizon (NYSE:VZ) Wireless and Sprint Nextel (NYSE:S) are the launch partners, though those BlackBerrys tend to make their way across any and all available networks over time.

This report didn't move RIM's stock price in the direction one might expect, probably because of forward guidance that only reaffirmed Wall Street's average guesstimates. If you have money to invest right now, that gives you a quick 15% discount on RIM stock today, compared to share prices seen early last week.

I gotta say I'm a little bit tempted myself. Mr. Market seems to ignore a lot of good news here.

Further Foolishness:

Google is a Motley Fool Rule Breakers recommendation. Apple is a Motley Fool Stock Advisor selection. Sprint Nextel is a Motley Fool Inside Value pick. Try any of our Foolish newsletters today, free for 30 days.

Fool contributor Anders Bylund owns shares in Google, but he holds no other position in any of the companies discussed here. You can check out Anders' holdings or a concise bio if you like, and The Motley Fool is investors writing for investors.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

BlackBerry Stock Quote
BlackBerry
BB
$5.07 (-3.24%) $0.17
Alphabet Inc. Stock Quote
Alphabet Inc.
GOOGL
$98.74 (-1.40%) $-1.40
Apple Inc. Stock Quote
Apple Inc.
AAPL
$150.43 (-1.51%) $-2.31
Verizon Communications Inc. Stock Quote
Verizon Communications Inc.
VZ
$39.52 (-1.03%) $0.41
Sprint Corporation Stock Quote
Sprint Corporation
S
Palm, Inc. Stock Quote
Palm, Inc.
PALM

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

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
339%
 
S&P 500 Returns
109%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/24/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.