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Russ Purdy

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  • Major U.K. Outlets Hike BlackBerry Z10 Price Above iPhone 5, Black Market Thriving [View article]
    Thanks! Nice to hear someone on the ground that can refute what the bears are saying. It seems like a red flag to me when you have bearish articles coming out way after the news has hit in an attempt to drive the price down. Would love to know how many stores you went to? and how much variance there was between stores? You mention the younger generation likes the phone for the BBM video, did you get more comments on the type of customers that were buying the Z10? work people, everyday consumers, teens, etc? Thanks again.
    Feb 21 10:09 AM | 13 Likes Like |Link to Comment
  • 3 Obstacles That Could Preclude RIM's Comeback [View article]
    I understand and completely agree that company will never be what it once was. I have been long less than a year and it based on the value I see in Blackberry's assets and lack of debt/goodwill. I am looking for the stock to move to the mid twenties not much higher than that unless they can start to regain market share (which I think will be difficult). But the fact that the market is growing at such a fast clip means that even if they can maintain market share they will see sales growth. It has been an interesting stock to follow for sure. Thanks for the follow up.
    Jan 30 03:42 PM | Likes Like |Link to Comment
  • 3 Obstacles That Could Preclude RIM's Comeback [View article]
    This has always been the case. Are these fears not already baked in the price? The app question will soon be answered as more developers move to HTML 5 and then apps can just be pinned to your homepage. Also Blackberry has apps that let you access the android app store. So I dont think BB10 will lose sales due to apps. The BYOD movement might actually help support RIMM as it draws more customers to higher service revenue products like Blackberry mobile fusion that will manage these different devices. I agree that it will be difficult for RIMM to take market share from apple or google, but the smart phone market is growing extremely quickly and people in emerging markets don't have the same stigma as we do in the US, so I think RIMM can at least maintain share which would lead to increasing sales. If this company had lots of debt or goodwill or didn't at least generate cash then I would be much less bullish, but you have to also look at the assets on the balance sheet. QNX is a great OS that derives revenue outside of BB10 and playbook.
    Jan 29 11:44 AM | 7 Likes Like |Link to Comment
  • 4 More Reasons To Sell Research In Motion Now [View article]
    I think we are about to see a consolidation of business operations. RIMM management most likely kicked out those who did not agree. The news that RIMM is going to focus on sales in Africa in the Middle East along with other Emerging Markets is very positive. This is where massive smart phone growth is taking place, and it is currently a market where Apple cannot compete with high priced phones. I think RIMM will find its market in the Emerging Markets, which will help it continue to add subscribers and maintain currently cash flow.
    Apr 12 11:44 AM | 1 Like Like |Link to Comment
  • Is There Asymmetrical Coverage Of Research In Motion In The Media? [View article]
    Anupam
    Great article finally someone focusing on the good about this company! I have been following RIMM for a while and think they are going to beat on EPS this quarter. Revenue will probably be in line with estimates maybe under but operating margin will be solid. I think RIMM could see $1EPS this quarter if not even higher. Below I reposted my comments on a previous article on RIMM.

    iPhones are the most popular phones in the US market but not around the world they are too expensive. People keep forgetting that the global smartphone market is expected to grow to near 1 billion people by 2015. If you factor iPhones increase in market share at 3.5% a year which is has been for the past four years and project android to take a market share of 55%, most estimates I found online said 50%. Then BlackBerry actually maintains sales. They don't go to zero. Lets not forget they have 75 million subscribers and the patents for the most secure operating system. BBM and social networking prepaid plans are very popular in developing countries where they do not have the financial infrastructure to have monthly data plans and everything is prepaid. The recent introduction of iPhones into the corporate world has only been made possible through a third party middleware company. Could this be a potential company to buy out RIMM to make there own product more secure?
    Also I would look for RIMM operating margins to increase this quarter compared to the around 6% in Q3. Do not forget they had a service outage that cost them 55 million, but if we look at their average service revenue assuming no growth in subscribers from Q2 we find that they also failed to recognize 133 million in revenue. We also see from the MD&A that their was a 485 million dollar non-cash write off playbooks done through COGS! They just increased there costs to reduce the carrying cost of playbooks in inventory. This, I believe, is partly due to the fact that the new update for the playbooks had not yet gone out so they were carrying too much inventory. RIMM also has some backlog of playbook revenue yet to be recorded because of revenue recognition rules. I think in the next 2-3 quarters we will see better than expected playbook sales. Finally RIMM increased admin expenses by 7 million in implementing cost saving initiatives. Factoring this in you come up with an adjusted margin of around 19%. This company has no debt, IP, and is not failing like everyone thinks. While this company is not what it was there balance sheet without intangible assets (IP) and cash it is is 6.6 billion. adding back the patents and cash we get 10.1 billion. It is trading at a P/E of 3.2 and a market cap of 7 billion. Lets not forget RIMM has EPS of 4.25. Just because these earnings are project to go down they are not projected to go zero anytime soon. I did this valuation before it came known that Einhorn also bought. He must see something similar.
    Disclosure: I am long RIMM. and purchased more shares March 1, 2012.

    I am not saying that RIMM does not have the potential to trade lower due to technicals, but at this level someone is going to buy them out. YES THEY MIGHT NEVER SELL ANOTHER PHONE IN THE US, but I would still buy based on their patents and international markets. They just wrote down COGS last quarter for non-cash of 485m and also have sales of around 120,000 playbooks for sure that will be recorded from backlogs this quarter. So we will probably seen a nice increase in margin this quarter in my opinion. (all info from filings) they also have until July to buyback shares...RIMM has not debt this is a possibility as well (while not likely). People need to realize that the world is getting smart phones in the same progression that the US did and RIMM is going to get a lot of first mover market in areas that cannot afford the iPhone and the iPhone does not work on their network. While RIMM will never be on the cutting edge and trading above 100 a share it is still a pretty solid company that is EARNING money.

    I am just a college student, but even I can figure out that the smart phone market is going to grow as a whole. I also own AAPL because the smart phone market is going to grow worldwide and RIMM is going to be there to add to its subscriber base. People need to quit being so ethnocentric.
    Mar 22 04:04 PM | 2 Likes Like |Link to Comment
  • Rumor Mill: Who Would Buy Research In Motion? [View article]
    I am not saying that RIMM does not have the potential to trade lower due to technicals, but at this level someone is going to buy them out. YES THEY MIGHT NEVER SELL ANOTHER PHONE IN THE US, but I would still buy based on their patents and international markets. They just wrote down COGS last quarter for non-cash of 485m and also have sales of around 120,000 playbooks for sure that will be recorded from backlogs this quarter. So we will probably seen a nice increase in margin this quarter in my opinion. (all info from filings) they also have until July to buyback shares...RIMM has not debt this is a possibility as well (while not likely). People need to realize that the world is getting smart phones in the same progression that the US did and RIMM is going to get a lot of first mover market in areas that cannot afford the iPhone and the iPhone does not work on their network. While RIMM will never be on the cutting edge and trading above 100 a share it is still a pretty solid company that is EARNING money.
    Mar 13 07:13 PM | Likes Like |Link to Comment
  • Rumor Mill: Who Would Buy Research In Motion? [View article]
    iPhones are the most popular phones in the US market but not around the world they are too expensive. People keep forgetting that the global smartphone market is expected to grow to near 1 billion people by 2015. If you factor iPhones increase in market share at 3.5% a year which is has been for the past four years and project android to take a market share of 55%, most estimates I found online said 50%. Then BlackBerry actually maintains sales. They don't go to zero. Lets not forget they have 75 million subscribers and the patents for the most secure operating system. BBM and social networking prepaid plans are very popular in developing countries where they do not have the financial infrastructure to have monthly data plans and everything is prepaid. The recent introduction of iPhones into the corporate world has only been made possible through a third party middleware company. Could this be a potential company to buy out RIMM to make there own product more secure?
    Also I would look for RIMM operating margins to increase this quarter compared to the around 6% in Q3. Do not forget they had a service outage that cost them 55 million, but if we look at their average service revenue assuming no growth in subscribers from Q2 we find that they also failed to recognize 133 million in revenue. We also see from the MD&A that their was a 485 million dollar non-cash write off playbooks done through COGS! They just increased there costs to reduce the carrying cost of playbooks in inventory. This, I believe, is partly due to the fact that the new update for the playbooks had not yet gone out so they were carrying too much inventory. RIMM also has some backlog of playbook revenue yet to be recorded because of revenue recognition rules. I think in the next 2-3 quarters we will see better than expected playbook sales. Finally RIMM increased admin expenses by 7 million in implementing cost saving initiatives. Factoring this in you come up with an adjusted margin of around 19%. This company has no debt, IP, and is not failing like everyone thinks. While this company is not what it was there balance sheet without intangible assets (IP) and cash it is is 6.6 billion. adding back the patents and cash we get 10.1 billion. It is trading at a P/E of 3.2 and a market cap of 7 billion. Lets not forget RIMM has EPS of 4.25. Just because these earnings are project to go down they are not projected to go zero anytime soon. I did this valuation before it came known that Einhorn also bought. He must see something similar.
    Disclosure: I am long RIMM. and purchased more shares March 1, 2012.
    Mar 1 06:00 PM | 1 Like Like |Link to Comment
  • Research In Motion Value Trap: Capitalizing On A Degenerative Business [View article]
    While market share is decreasing for RIMM, the overall market is growing at a faster rate. This should leave RIMM sales flat to slightly down in a medium case scenario. While RIMM is no longer a major player in the US market they compete much better internationally where monthly plans that fit the OIS and Droid selling system are not as common place. Also the article mentions the reduced margins, but what about the external shocks that hit during Q3? If we take these out is the company not on such as great crash course?
    Feb 21 12:45 PM | Likes Like |Link to Comment
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