RIM 'Priced to Perfection'; Gadgets Top Gifts in '07

1. Research in Motion (RIMM) (-0.4%, $116.94) could be priced to perfection, based on a Zacks Investment Research analyst's report (new target: $135/share). Last Wed. Bear Stearns upgraded RIMM to "outperform" with a target of $150 to $170.

2. The third time to surpass $200 intra-day was not a charm for Apple (AAPL) (+0.6%, $199.83), which failed to hold the level again at the market close on Friday. Still, Apple is among the best ytd performers of the S&P 500 (up around 135%) and its products grabbed plenty of spots on 2007 "best" lists.

• Also among the best ytd performers: GameStop (GME) (+0.1%, $62.30), up over 125%.

3. Gadgets Grab Holiday Cheer - Barron's. A Wedbush Morgan analyst likes Trident Microsystems (TRID) (-4.1%, $6.14) as a play on strong LCD TV sales and Monolithic Power Systems (MPWR) (+0.3%, $21.35) and 02 Micro (OIIM) (+0.4%, $11.43) on hot-selling notebook PCs.

4. Nintendo's (NTDOY.PK) (+0.6%, $73.75) DS handheld device is driving sales along side the Wii.

Comments

[jonreagan]

Steve--I think a good follow-up here would be a case study of what happened to RIMM's stock price over the November-December period. Specifically, a Morgan Keegan analyst downgraded the stock early on during this period, after which all kinds of negative buzz began, about how the stock had "broken down". I believe it got as low as $99, after reaching a high of $137.

Could RIMM have gone from being one of the vaunted "four horseman" stud stocks, to a broken stock, and then back to having targets around $170 again--all in a space of 8 weeks? There are more and more examples of gaming and rigging going on in the market--which are occasionally illegal, such as naked shorting. More often than not, it's just a case of traders trying to create buying opportunities. This is fine, as long as such people don't masquerade as financial analysts when they're merely traders like the rest of us, trying to make a few bucks. One SA writer offered a piece two weeks ago urging readers to bail out of AAPL ("get out while you can"), raising all kinds of wierd scenarios about the company's future; to read this garbage, you would have thought Apple was some kind of speculative play. And it came out only days before AMZN published its "top 10" list of best selling holiday gadgets, five of which belonged to Apple.

In the case of the Morgan Keegan analyst and RIMM, I wouldn't necessarily question his motives, but I'd sure question his competence--especially now that RIMM is being hailed again as a star. One guest on CNBC suggested last week that they could ultimately grow their subscriber base to 100 million. While this may represent an opposite extreme of optimism, it's increasingly difficult for the average investor to find that "sensible center" middle ground, where the truth usually lives.

[rlh]

I am amazed at how many people have made such comments in this last (tax selling) week of the year. I think AAPL held up remarkably well with the onslaught of sales. It should reach $210 or better by Macworld. After that it will probably see some selling pressure but the long term (12-18 months) is $300 when Wall Street realizes the hidden value of the iPhone venture to spur the biggest money maker of all for this COMPUTER MAKER, the Mac.

[Brewer]

Absolutely true about Apple. This could be the first year there is no significant dip after MacWorld. Some short traders will no doubt dump the stock, but there may be an excess of investors trying to buy at this time (which is well known as a typical dip.

Windows users and pundits main problem with the iPhone is that it's not as tightly integrated with Windows as it is with Mac. Well, DUH.