Anyone notice that Research in Motion (RIMM) has not participated in the recent mini-rally over the last few days? Obviously, all focus right now is on whether Palm (PALM) ends up selling itself. My thought is: who cares? Palm has not made a significant change to its hardware in a number of years and the software is mediocre - I guess you can say it's better than Windows Mobile, but that's not exactly a high hurdle.
Periodically you get an anomaly in the markets and those who pick it up get rewarded handsomely. Did anyone notice the following in RIM's recent announcement of the results of the stock options scandal:
Statement of the Special Committee:
"We are satisfied with the thoroughness of the review and we believe that the resulting enhancements to governance and controls will make RIM even stronger as it continues to grow and lead in the thriving market it pioneered,” said Mr. Estill and Mr. Richardson in a joint statement. “It must also be said that we have the utmost confidence in Jim Balsillie and the senior management team. Over the last ten years, incredible results have been accomplished under their stewardship including an increase in RIM’s annual revenue by more than 45,000% and an increase in RIM’s share price by more than 10,000%. In addition, RIM just achieved another important corporate milestone in the fourth quarter ended March 3, 2007 by adding 1 million BlackBerry subscriber accounts within a single quarter for the first time. These results speak loudly about the management team and the value of their leadership to RIM and its shareholders."
Now, to me, when the company guides to 950,000-975,000 subscriber adds but actually adds over 1 million subscribers, this is something worth looking at. Doesn't it mean that the quarter is in the bag and they are continuing to execute well? Food for thought.
Disclosure: Author has a long position in RIMM.
RIMM 1-yr chart