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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Moj Jalali who wrote (46190)	1/14/2012 2:59:57 PM
From: Spekulatius	Respond to of 78702

I regard the success that RIMM is enjoying in India as temporary. RIMM advantage right now is that the email services will run reasonably well on the prevalent 2G network while Android and Iphone really need 3G networks to work well. The 3G network buildout started late in India in 2010, once the infrastructure is working well, I assume that RIMM will get clobbered by the better Android and Iphone's just like anywhere else. Also keep in mind that while RIMM has earnings, the cash flow recently have been exceedingly weak, in fact if I remember correctly, RIMM has burned though a considerable amount of cash defending their position (patent purchases, supply chain financing, tablet writeoffs). Even if RIMM turns around their fortunes, their future will be much less profitable than the past, imo. I assume so, because I think that RIMM email service costs the consumer 10$/month in the US. This is a service that with Android and Iphone is free and where RIMM needs to dramatically lower their prices to compete, in my opinion.

To: Moj Jalali who wrote (46190)	1/16/2012 4:37:42 PM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 78702

There are definitely positives in RIMM. Low valuation. Still positive earnings. No debt. RIMM email platform. Some brand cachet (even discounting the tired look for executives). There are negatives too. They are losing market share. They are struggling to convert to a new still pretty much proprietary platform. Clownbuck is right that their cash flows are bad in last 3 quarters. 3B of the book value are intangibles. IMHO, RIMM has more time to right the ship than most bears expect. However, I am not sure they have a good plan for righting the ship yet. They have to throw in the towel and switch either to Android or to MS Win. But either of these choices makes it an also-ran late-to-the-party. On the other hand if they stick with their proprietary stack (and QNX), they will have very few developers and very few 3rd party apps. So they could sell basic smartphones, but not the top-line app-rich phones. Overall it's tough to estimate what the remaining market for them will be and how things will work out. I think NOK is in better shape and further down the road in re-turning than RIMM. OTOH, NOK is a bigger ship, it has some of its own issues, it has losses, etc. And NOK is still risky - if their MS Win phone line is not successful, they will be in much worse shape, since they would be very late to any party. Personally, I still prefer NOK and own a small position. However, overall, I'd say neither company is a top-line investment here.

To: Moj Jalali who wrote (46190)	1/25/2012 8:23:13 AM
From: Mattyice	Respond to of 78702

Moj, RIMM: Thank you for the response (also Clownbuck, and Jurgis) I think clownbuck and Jurgis hit on the issues they are having technically. And your points are also good ones. I think there is some flaws in your rationale about it being 1/7th of its peak valuation - for me that seems to have always got people in trouble especially tech plays. Also, For me trying to cut through the clutter, RIMM best case scenario FOR ME through my quick take on the valuation you are looking at it being taken out at current price or slightly lower - maybe $5 billion market cap. For this to happen you would need to the price to fall AT LEAST another 20-30% so they could then be taken over by a decent respectable premium. Maybe it would make sense to take a look at it then considering a company could take it over and cut the crud - then it becomes a straight up private cash flow/valuation project for someone with a patent kicker. There is value here Moj, at some level but i would still think cash would be a better option at this time. Matt