RIM (NDQ: RIMM) makes it to the Cara Global Best 100 because it meets the criteria I stated in yesterday's article:

"Basically I look for large companies that have at least four or five consistent years of high level profitability, superior operating growth (based on some kind of "unfair" advantage), and solid financial strength. These companies can have high PE's, like YHOO (another on my list), but unless I can follow them closely intra-day, I wouldn't be long a PE> 4x S&P500."

As this is a relatively new company with a ground-breaking technology, I'm prepared to overlook the duration of profitability criterion; but not my need to see significant profitability growth. Including the recent loss quarter due to its resolving key legal issues, RIM's net income for fiscal 2005 is $213.4 million on revenue of $1.35 billion. I suspect that, without the legal issues, earnings could have been $100 million more.

RIM's "unfair" advantage is its elegant technology. People say that Washington and Wall Street would both stop if their "crackberries" ceased working.

It goes without saying that the five-year revenue growth rate for RIM is off the charts, so it's not a number I focus on. Suffice to say that top line revenue more than doubled from $594.6 million (FY2004) to $1.35 billion in the latest fiscal year. The die is cast with the enormity of these numbers.

As to financial strength, RIM is totally solvent and has the resources it needs to jump to the next level as a global leader in the technology sector.

RIM is growing so fast that the financial data lags the operating reality, but it still pays to look at the financial summaries, which are available at ADVFN.

Last evening, RIM reported operating results and guided investors with caution due to concerns about shipment levels (in a softening global economy) and re tax matters regarding its recent legal settlement. Consequently, the stock traded down in after-hours trading.

Earlier today the stock (NDQ: RIMM) is trading at $71.62, which is down 3.7 pct from yesterday's close of $74.40. If the broad market were not such a concern to me, I would be recommending accumulation at this level. But I suspect that lower prices are ahead in the next month or two for RIMM.

Today, the Toronto Star published an informative article of this Toronto-area company. The newspaper also informed readers today of the situation with another Toronto-born "star", newsreader Peter Jennings who has announced he is in tough with lung cancer.

Our prayers go out to Peter, a totally credible media personality who has grown to be respected by society in all parts of the world.

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RIM misses analysts' forecast: Shares take hit in after-hours trade; Sales, client gains fail to offset loss

"Research in Motion Ltd. shares fell 7 per cent yesterday in after-hours trading when the company failed to meet analyst's expectations despite a surge in sales and posted a fourth-quarter net loss of nearly $2.6 million (U.S.).

RIM, which is best known for its BlackBerry wireless device, reported a loss of 1 cent a share in the period ended Feb. 26, after taking into account an expensive out-of-court settlement. That compared with net income of $41.5 million, or 23 cents a share, in the corresponding 2004 period.

Executives and some analysts remained optimistic, however. "We've become so spoiled," said Barry Richards, wireless analyst Paradigm Capital. "For quite a few quarters we had better-than-expected everything."

This time around shipments were lower than expected, but revenues were still up more than 92 per cent for the quarter, year over year. RIM, which reports results in U.S. dollars, said fourth-quarter revenue were $404.8 million. That was within the firm's own guidance but less than analysts' expectations of $410 million, according to Thomson First Call.

Richards said he believes the Waterloo-based company compensated for the loss by making more money than expected on software upgrades and attracting so many new customers.

According to RIM, the subscriber base grew by 470,000 in the fourth quarter to approximately 2.51 million, up 135 per cent year over year. "There is no question that we continue to be very encouraged by the ramp up in our subscriber growth," said Jim Balsillie, RIM's chairman and co-chief executive officer. The company also overcame a major legal hurdle in the quarter.

In March, RIM agreed to pay NTP Inc. of Arlington, Va., $450 million to settle a patent dispute. In addition to covering all outstanding claims, the out-of-court settlement stops NTP from pursuing any future patent litigation against RIM. It also gives RIM a fully paid licence for NTP's patents.

Analysts were pleased with the settlement, despite the high price, because it ends a long-standing legal battle and puts to rest fears that the company might not be able to sell its devices in the U.S.

RIM's stock still took an initial hit following yesterday's announcement, falling by as much as $5.20 in after-hours trading in New York before gaining back some ground. The shares ended regular trading prior to the financial report at $74.40 on the Nasdaq Stock Market, down 75 cents from Monday, in the Toronto, down 76 cents.

"There are going to be some people that will be a bit disappointed (by lower-than-expected shipments)," said James Faucette, senior equity analyst Pacific Crest Securities. The total number of units shipped fell short of targets by 50,000 to 90,000, he said, adding, "That's a pretty big deal." But Faucette said it's too soon to say whether the shipment figures are "a harbinger of slower growth ahead."

Richards wasn't too concerned and said it was simply a matter of wireless carriers trying to keep tighter inventory.

Revenue for fiscal 2005 was $1.35 billion (U.S.) — more than double the $594.6 million in 2004. Net income was $213.4 million, or $1.09 per diluted share. That's up from a fiscal 2004 net profit of $51.8 million, or 31 cents a share.

RIM said its profit in the current quarter will be less than the company estimated in December and below analysts' recent estimates due in part to a higher tax rate than initially expected in the quarter — another factor related to the NTP settlement."

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Here is the short-term trading picture for RIMM: