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November 17, 2006

RIMM definitely in Motion, Fri., Nov. 17, 2006, 10:12 AM

Research In Motion (NDQ: RIMM) is clearly on the move. Today, UBS maintains their Buy rating, but revises their 12-month target to US$160. Funny how one gazillionaire ROBTV Talking Head told you he was short at $60.

Download UBS Nov 17 report on RIMM.

I wrote up this Cara 100 company several weeks ago at a much better price than today's US$134. In fact, when I wrote it up recently, the stock was $113.84. That was Oct 16. The stock is up +15.1 pct in a month, carried on the back of the current market bullishness.

In my October article, I warned that a Bear market will take the stock much lower, perhaps (now that it's had such a good run) not back to $75, but I still think much lower than $100. And then I'll set my new 12-month Price Target (PT) to $160 (like UBS) or possibly higher.

No positions this morning.

This is a great company, presently riding the top of a wave. Don't forget what happens after the wave crests.

Posted by Posted by Bill Cara on November 17, 2006 10:12:22 AM | Category: 45 Info Technology , Canada , Cara Global 100 Best Companies

Discourse

Nokia just introduced the E-62 smartphone, which was favorably reviewed by Mossberg in WSJ, and which Cingular will sell for about $150.

Fortune reported that Nokia has 3,000 people working on mobile business software. Nokia uses and controls the Symbian operating system, a full-fledged computer-in-a-phone which dominates Europe.

How long before the world's largest cellphone company starts to overwhelm RIMM in the North American market?

Posted by: Jock [TypeKey Profile Page] at November 17, 2006 3:04 PM [link]

"Funny how one gazillionaire ROBTV Talking Head told you he was short at $60."

I'm guessing you're referring to Kevin O'Leary, although I didn't see the call itself (did do some quick research, seems he's been shorting it for over a year now).

Personally, I wonder why the man has so much respect. Yes, he did clear something like $1 billion for himself by selling The Learning Company to Mattel at the peak of the tech bubble. However, Mattel's CEO was fired only a few months later for making the purchase, and TLC's compilation of education titles/companies basically disintegrated within the year. Mattel bought a great, big collection of money-losing titles.

From the LATimes (05/14/2000):

"Mattel's next chief executive faces rebuilding a company that has lost almost 70% of its market value in the last seven months, mostly because of a disastrous acquisition. The new leader also must deal with infuriated investors, depleted management ranks and a volatile industry with historically low returns"

"The bulk of the company's woes stem from its 1999 purchase of software maker Learning Co., whose game titles include 'Myst' and 'Carmen Sandiego.' The $3.5-billion deal was part of Barad's [the recently departed CEO] bid to broaden Mattel's reach in the entertainment and high-tech businesses. But a fast-shrinking CD-ROM market and internal problems with the company combined to sink Learning Co.'s fortunes. Mattel lost more than $200 million on the venture, which caused its stock to plunge 61% over the last year. It closed Friday at $10.75, down 44 cents on the New York Stock Exchange. [It's purchase of TLC] turned into a fiasco that produced Mattel's first losses in 11 years. Mattel now is trying to sell Learning Co., ..."

Since that time, O'Leary has spent as much time complaining about the money he lost in handing over his investments to money managers as anything else. If you combine these complaints with his shorting of RIMM and his angry bleating over the income trust issue, you start to wonder how much of that $1 billion he has left over. There must be a reason he's in such a permanently nasty mood on his various TV shows.

Posted by: just_observing [TypeKey Profile Page] at November 17, 2006 3:49 PM [link]

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