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BlackBerry Limited Message Board

  • septcalls06 septcalls06 Sep 25, 2012 7:42 PM Flag

    My reasoning for expecting more pain...

    1) revenue likely has continued to drop as the cost for a Bberry device is free-$30 if you get a contract with a carrier

    2) More businesses are allowing employees to use iphones and android phones than in previous years. I know of few people in the oil & gas industry that are using a BBerry and intend to not jump ship to an iphone when the contract is up as their company now allows this.

    3) RIMM has said themselves they are focusing on emerging markets including Africa and Southeast Asia. That is good for increasing subscriber numbers, but how much are people paying for a phone in these countries? Are they using new phones or refurbished phones? What is the likelihood that these users will upgrade to a BB10 device? And if they will, what price point?

    4) operating costs have had to have increased this quarter as a result of the R&D poured into the BB10.

    5) How much has the company had to pay out as severance as a result of the layoffs? When this is combined with #'s 1 and 4, how much of the cash that RIMM was sitting on is left? Is there a chance they will have to go into debt to produce the BB10?

    6) The new developer incentive of paying them $10,000 if they don't hit that mark themselves on a BBerry certified app has potential to cost RIMM money in the early stages of the BB10 (if BB10 is successful then I think this incentive is exceptionally well played)

    7) What did we see today of the BB10. It looks very nice and well though out in my opinion, especially on the interface side from what I've read and the pictures/videos posted today. But I don't see a feature that is going to take people away from an iPhone. Do you?

    I went into today short and got a 15% haircut on my options which hurts, but I'm not changing my stance on RIMM and used today to buy more Puts. There is a chance I'm wrong just from the fact of how low the price is and how low earnings expectations are, but I think there's a higher likelihood of downward pressure than upwards.

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    • Ignore the Pumpers. Your logic is simple. I've been saying the same thing since oh so long ago. Some people have blind faith in a company that continues to fail and a management which has consistently lied.

      RIMM has started eating into their cash reserves, guaranteed.

    • Yeah shortie, just keep shorting, short short ............ You have a lot of reasons to short, and i don't give a damx, i only have one reason to buy, my reason is BB10, that is the magic word, like abracadabra....... :)

      Sentiment: Strong Buy

    • "But I don't see a feature that is going to take people away from an iPhone. Do you?"
      Heck ya, Cisco's teleconferencing, its multi tasking capabilities, etc., it will not only catch up but for RIM, who warned about these last few and next few quarters says they will set a new standard. it may not be hype.

      Sentiment: Buy

    • There's a lot you don't understand about this company. A few points.

      Contrary to American ignorance, ex-USA customers are not all poor third worlders. Even so-called "emerging markets" are not strictly low-end. There are a lot of countries ex-USA! Don't get me wrong, obviously RIM would love to gain marketshare in the USA. Duh. But if you are going to analyze RIM properly, you must see the entire world. Yes, the poorer the country, the greater the percentage of lower-end phones. But you'd be surprised how many people in those countries have the higher-end phones AND will upgrade to BB10 when available. Don't forget that BB10 is going to have mid and low-level phones! So when you say BB10 - you are not just talking about one phone like iphone. There will be 6 BB10 handsets, at least 2 or more BB10 tablets, likely a tablet w/ keyboard (read: PC laptop killer), as well as integration into automobiles. Last, countries like Canada and the UK are first world and much less hostile to RIM. To be sure, the USA will be the toughest nut to crack for BB10. But eventually they MIGHT come around. You'd be surprised how many Android and IOS users are not that happy with their handsets and will switch. Put it this way, just about everyone who is going to leave has already left! Those remaining will gladly wait another 4 or 5 months. RIM's rollout strategy (i.e. focus ont eh faithful and loyal first) makes sense given all of the above.

      The developer incentive is limited in total. It is insignificant to RIM. Not worth mentioning.

      RIM is expected to be nearly cashflow even for the past quarter. Yes, they will likely burn through some cash before BB10 revenues kick in. However, you are way off if you think they are going to run out of cash before rolling out BB10. Even if they burn a billion, that'll still leave over a billion remaining.

      I can't for the life of me understand anyone who would want to short this stock NOW. Yeesh. Talk about being late to the party. This stock is the most hated stock on Wall Street. lol. It has been pulverized. Smashed into the ground. A bit overdone IMO, but RIM certainly deserved most of it.

      I can understand not going long. But to go short here is such a poor play. Even if it sells off into the $5's on horrific earnings, that's a very small reward. Much to the chagrin of the RIM haters, it is not going to zero. It is not Nortel. Not PALM. Not EK. You can forget about that. This company will be around for YEARS AND YEARS. Even if BB10 bombed, which it won't, they'd still be around for years and could change focus, sell off pieces, etc. The liquidation value of the businesses and patents is greater than the current stock price.

      Remember this: at some point, the organized criminals that run this stock will take the other side. Like clockwork. You can bet on it. Look at the long-term chart of RIM. This is not the first time this stock has gone through the roof, then crashed, only to go through the roof again. I'm not predicting $100 again next year. lol. But I do think you're looking at a two to three bagger at some point in 2013.

      • 3 Replies to slickvguy
      • If you short expect more pain and if you long enjoy the up up move pleasure

        Sentiment: Strong Buy

      • First, thanks for the reply, you make some very good points.

        For the record however, I'm an American currently living in Canada (Calgary to be exact) so when I say I know no one wanting to stay with RIMM I'm speaking from some (albeit localized) experience in both Canada and the US.

        I don't discount that they will sell phones in the developing markets, but I don't expect the same gusto as if those subscribers were in the US, hence I look at a 2 million subscriber increase and still see an overall loss in terms of units the company can push out the door.

        I just don't see any way for this company to move back into profitability and remain there. I imagine they will have a profitable FQ4 2013 and FQ1 2014 with the release of BB10, but the subscriber base won't be enough to push the app market anywhere and without suitable apps the phone will die off again. So yes, you are probably right in saying there is quite a bit of money to be made on the upside of this stock, but it's not yet. They had nothing this last quarter to make me think their numbers will be even what Wall St is looking for. With that being said, I do own some calls to hedge my downside potential.

        And for the comment below about Cisco's teleconferencing functionality, that is an exceptional idea, and I would benefit as much as many as my company uses a Cisco IP telephony system, but as one of the masses walking into an ATT or Telus store (depending on what side of the border I'm on that day) I don't see that being a swaying factor for me personally. Especially when my company already has a conference call system in place that is independent of the Cisco network.

      • Damn well said!!!!

 
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