Research In Motion May Be The Big Loser In A Palm Buyout

Mar.21.07 | About: BlackBerry Ltd. (BBRY)

James Faucette, an analyst at Pacific Crest Securities, asserted today that Research in Motion (RIMM) is likely to “post upside” to his estimates for the company’s fiscal fourth quarter ended February. Faucette sees $932.3 million in revenue for the quarter and EPS of $1.02.

Faucette says that checks with retail sales people finds that the initial reception for the 8800 phone, which was launched in late February, “has been solid.” He says the sell through rate for the Pearl, a similar phone without a full QWERTY keyboard, “softened a bit in March.” Overall, though, he says that new product momentum should drive better-than-expected results.

Meanwhile, I have to think that an acquisition of Palm (PALM) by either Nokia (NYSE:NOK) or Motorola (MOT) will not be viewed as a good thing for Research in Motion. The result would be beefed up distribution and resources for a directly competitive product.

For what its worth, I continue to think that the close ties between Palm and Motorola subsidiary Good Technology make Motorola a more logical buyer than Nokia.