Traders Place Bullish Bets on RIM (RIMM) into FY13, But Not Everyone's Convinced
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Research In Motion (Nasdaq: RIMM) shares have been getting hammered since hitting a one-year high of $33.54 last September, with investors getting grim on the prospects for the Waterloo, Ontario-based mobile giant to make a comeback with its next mobile OS, BlackBerry 10, having been delayed time and again and mobile market share slipping faster than grains of sand through an hourglass.
All that might change, according to at least one key trading metric.
Data from Bloomberg suggests that the call-to-put ratio on RIM options from June 15th to the end of July climbed the most since November 2009, to a ratio of 1.37:1. That's a 51 percent climb over the month-and-a-half period. Overall, open interest on calls is at about 700,000, while put open interest rose 11 percent over the same period to 512,000.
Having lost 95 percent of its market cap over the last two years, investors are looking to any bit of good news to drive shares higher. RIM stock is nearly at nine year lows.
Not everyone's convinced, however, with borrowed stock (an indication of traders going short, or expecting more downside by selling at one price with hopes of buying back shares at a lower price) at 5.1 percent of outstanding on July 24th, the highest level ever.
Sentiment is growing surrounding the launch of BB10 in early 2013 and there seems to be little left in terms of downside catalysts for RIM over the next few months. Some would have liked BB10 to launch ahead of the 2012 holiday shopping season, when peers like Apple (Nasdaq: AAPL), Microsoft (Nasdaq: MSFT), Google (Nasdaq: GOOG), and Nokia (NYSE: NOK) will be releasing new devices and software. That means less consumers will be hankering for a new device come Spring/Summer 2013, having already updated to the latest iPhone or Surface tablet.
With January 11 calls holding the largest ownership interest, RIM investors might need to look the other way in the latter part of 2012, but could be rewarded as consumers return back to BlackBerry.
Shares of RIM are up about 0.7 percent in early trading Friday.
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All that might change, according to at least one key trading metric.
Data from Bloomberg suggests that the call-to-put ratio on RIM options from June 15th to the end of July climbed the most since November 2009, to a ratio of 1.37:1. That's a 51 percent climb over the month-and-a-half period. Overall, open interest on calls is at about 700,000, while put open interest rose 11 percent over the same period to 512,000.
Having lost 95 percent of its market cap over the last two years, investors are looking to any bit of good news to drive shares higher. RIM stock is nearly at nine year lows.
Not everyone's convinced, however, with borrowed stock (an indication of traders going short, or expecting more downside by selling at one price with hopes of buying back shares at a lower price) at 5.1 percent of outstanding on July 24th, the highest level ever.
Sentiment is growing surrounding the launch of BB10 in early 2013 and there seems to be little left in terms of downside catalysts for RIM over the next few months. Some would have liked BB10 to launch ahead of the 2012 holiday shopping season, when peers like Apple (Nasdaq: AAPL), Microsoft (Nasdaq: MSFT), Google (Nasdaq: GOOG), and Nokia (NYSE: NOK) will be releasing new devices and software. That means less consumers will be hankering for a new device come Spring/Summer 2013, having already updated to the latest iPhone or Surface tablet.
With January 11 calls holding the largest ownership interest, RIM investors might need to look the other way in the latter part of 2012, but could be rewarded as consumers return back to BlackBerry.
Shares of RIM are up about 0.7 percent in early trading Friday.
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