Will RIM’s Stock Ever Return To Prominence?

Research In Motion has $2.07 billion in cash and no debt. It doesn’t get much better than that in this industry unless you’re Apple, which has $29.13 billion in cash and no debt. Nokia has $10.99 billion in cash and $5.15 billion in debt.

T = Technicals on the Stock Chart Are Poor

Research In Motion has outperformed the S&P 500 for the past month, but it has greatly underperformed the S&P 500 over the past three years.

Over the past month, Research In Motion is up 46.63% while the S&P 500 is down .66%. Year-to-date, Research In Motion is down 23.45% while the S&P 500 is up 13.50%. Over the past calendar year, Research In Motion is down 32.65% while the S&P 500 is up 23.48%. When you look at three-year returns, Research In Motion is down a massive 80.91% while the S&P 500 is up 36.46%.

At $11.10, Research In Motion is trading close to its 50-day SMA of $11.07. It’s also trading close to its 100-day SMA and 200-day SMA of $11.11. Yes, they’re the same number.

E = Earnings And Revenue Are Only Steady On An Annual Basis

Earnings have been steady and revenue growth has been impressive over the past five years:

2008 2009 2010 2011 2012
Revenue ($)in billions 6.01 11.06 14.95 19.91 18.44
Diluted EPS ($) 2.26 3.30 4.31 6.34 2.22

 

The quarterly numbers haven’t been as impressive:

8/2011 11/2011 2/2012 5/2012 8/2012
Revenue ($)in billions 4.17 5.17 4.19 2.81 2.87
Diluted EPS ($) .63 .51 -.24 -.99 -.45

 

T = Trends Support the Industry

Mobile is huge right now. It’s one of the fastest growing businesses in the world. At the current time, only 46% of Americans own a mobile device. This means there are almost 150 million people in United States without a mobile device. That’s a tremendous untapped market. And that’s just the United States. The problem for Research In Motion is…

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