Analyst Warns of Elevated Warranty Returns for BlackBerry Devices (RIMM)
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Price: $14.64 +12.36%
Rating Summary:
0 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
0 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Shares of Research In Motion (Nasdaq: RIMM) are moving higher above a key technical indicator Thursday morning amid news China Unicom (NYSE: CHU) launched Internet service for BlackBerry users. The stock last traded at $13.43, up more than 2 percent from Wednesday's closing price.
The move higher comes despite a concerning report from MKM Partners' Michael Genovese. The analyst pointed to recent channel checks which have noted "abnormally" high warranty returns at Verizon (NYSE: VZ). BlackBerry 7 models had returns "well over" 10 percent and possibly as high as 20 percent. Genovese said a Verizon sales rep suggested most of these devices are locking up right out of the box and in need of immediate hardware replacement. Some stores are actively advising customers against buying BlackBerry devices, Genovese said.
The MKM analyst reduced his FY13 EPS estimate for Research In Motion from $3.62 to $2.92 and his sales estimate from $17.66 billion to $16.57 billion. The Street is currently expecting FY13 EPS and sales of $2.84 and $17.56 billion, respectively.
Genovese maintains a Neutral rating and $15 price target on shares of RIM.
Visit our Analyst Ratings page to track all the market-moving analyst action on shares of Research In Motion.
The move higher comes despite a concerning report from MKM Partners' Michael Genovese. The analyst pointed to recent channel checks which have noted "abnormally" high warranty returns at Verizon (NYSE: VZ). BlackBerry 7 models had returns "well over" 10 percent and possibly as high as 20 percent. Genovese said a Verizon sales rep suggested most of these devices are locking up right out of the box and in need of immediate hardware replacement. Some stores are actively advising customers against buying BlackBerry devices, Genovese said.
The MKM analyst reduced his FY13 EPS estimate for Research In Motion from $3.62 to $2.92 and his sales estimate from $17.66 billion to $16.57 billion. The Street is currently expecting FY13 EPS and sales of $2.84 and $17.56 billion, respectively.
Genovese maintains a Neutral rating and $15 price target on shares of RIM.
Visit our Analyst Ratings page to track all the market-moving analyst action on shares of Research In Motion.
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