Jefferies Reiterates an 'Underperform' on Research In Motion (RIMM); Drops PT to $5; Huge Pothole with No Product Launch

June 29, 2012 7:14 AM EDT
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Price: $14.64 +12.36%

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Jefferies reiterates an 'Underperform' on Research In Motion Ltd. (NASDAQ: RIMM) price target of $5.00 (from $10.00).

Analyst, Peter Misek, said, "Despite having already pre-announced partial FQ1 (May) results, RIM managed to continue its string of negative surprises. The FQ1 $(0.37) loss and $2.8B revenues were worse than expected. Most importantly, the launch of BB10 was delayed until CQ1:12. We continue to believe that RIM is unlikely to be acquired before BB10 launches and reiterate our rating."

Misek also expects the company to start burning through cash as a huge product pothole in the second half of 2012 pressures margins and additional subscribers. Lowering estimates: FY13 from $0.90/$15.3B to $(1.86)/$10.3B.

For an analyst ratings summary and ratings history on Research In Motion Ltd. click here. For more ratings news on Research In Motion Ltd. click here.

Shares of Research In Motion Ltd. closed at $9.13 yesterday.

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