Ticonderoga on IT Hardware & Networking - Derivative Thoughts on RIMM's Big 2QFY12 Guide Down
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Today's Overall Ratings:
Up: 8 | Down: 6 | New: 26
Rating Summary:
0 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 6 | New: 26
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Ticonderoga on IT Hardware & Networking - Derivative Thoughts on RIMM's Big 2QFY12 Guide Down
Ticonderoga analyst, Brian J. White, said, "RIMM's 1QFY12 Sales Come Up Short. Last night, Research In Motion (Nasdaq: RIMM)(NotRated) reported 1QFY12 sales of $4.91 billion (down 12% Q/Q vs. 8-year average of up 13%) that missed both the Street's estimate of $5.15 billion and the company's 1Q outlook (i.e., $5.2-$5.6 billion) due to product mix, combined with weakness in the U.S. and Latin America. Earlier this week, we indicated that RIMM may need to reset expectations going forward and we believe even the biggest bears will be surprised by the magnitude of the 2QFY12 guide down."
"The Fall of RIMM to Benefit Apple. Essentially, RIMM is struggling with market share as more innovative smartphones ramp in the market. We believe the challenges of both Nokia (NYSE: NOK)(NotRated) and RIMM provide Apple's (Nasdaq: AAPL)(Buy) portfolio with an opportunity for market share gain opportunities in the coming quarters, while we believe the iPhone and iPad will challenge RIMM's enterprise dominance."
"Derivative Supply Chain Thoughts on RIMM's Poor Outlook. We expect negative sentiment around the RIMM supply chain this morning. Within our coverage universe, Celestica (NYSE: CLS)(Buy) has the highest exposure to RIMM at 21% of 1Q11 sales and could come up short in 2Q11, while Flextronics (Nasdaq: FLEX)(Sell) generated over 10% of 1QCY11 revenue from RIMM. Outside of our coverage universe, Jabil Circuit (NYSE: JBL)(NR) generated 15% of FY10 sales from RIMM and we believe Multi-Fineline Electronix (Nasdaq: MFLX)(NR) generated 30-45% of sales from RIMM in the past."
Ticonderoga analyst, Brian J. White, said, "RIMM's 1QFY12 Sales Come Up Short. Last night, Research In Motion (Nasdaq: RIMM)(NotRated) reported 1QFY12 sales of $4.91 billion (down 12% Q/Q vs. 8-year average of up 13%) that missed both the Street's estimate of $5.15 billion and the company's 1Q outlook (i.e., $5.2-$5.6 billion) due to product mix, combined with weakness in the U.S. and Latin America. Earlier this week, we indicated that RIMM may need to reset expectations going forward and we believe even the biggest bears will be surprised by the magnitude of the 2QFY12 guide down."
"The Fall of RIMM to Benefit Apple. Essentially, RIMM is struggling with market share as more innovative smartphones ramp in the market. We believe the challenges of both Nokia (NYSE: NOK)(NotRated) and RIMM provide Apple's (Nasdaq: AAPL)(Buy) portfolio with an opportunity for market share gain opportunities in the coming quarters, while we believe the iPhone and iPad will challenge RIMM's enterprise dominance."
"Derivative Supply Chain Thoughts on RIMM's Poor Outlook. We expect negative sentiment around the RIMM supply chain this morning. Within our coverage universe, Celestica (NYSE: CLS)(Buy) has the highest exposure to RIMM at 21% of 1Q11 sales and could come up short in 2Q11, while Flextronics (Nasdaq: FLEX)(Sell) generated over 10% of 1QCY11 revenue from RIMM. Outside of our coverage universe, Jabil Circuit (NYSE: JBL)(NR) generated 15% of FY10 sales from RIMM and we believe Multi-Fineline Electronix (Nasdaq: MFLX)(NR) generated 30-45% of sales from RIMM in the past."
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