George Leong writes: I can honestly say that I’m excited to see the introduction of the new and highly anticipated “BlackBerry 10” (BB10) operating system and products by Research In Motion Limited (NASDAQ/RIMM; TSX/RIM) today. The overall market also appears hyped up on the BB10 platform. Research In Motion (RIM) has surged 176% since trading at $6.43 on September 21, 2012, as traders speculate on the company.
My technical analysis shows a widening gap on the chart on January 22 on a bullish moving average convergence/divergence (MACD) indicator (marked by the circles in the chart below), which is bullish. But watch the overbought condition. Also, the emergence of a bullish golden cross as indicated on the chart was a strong buy signal.
Chart courtesy of www.StockCharts.com
My stock analysis suggests that RIM appears to be rising out from the ashes, as investors dive back into the once-fabled maker of the BlackBerry. For RIM, it has been quite the journey after the investment community, including myself, thought the end was near for this former Wall Street star. Since the emergence of Apple Inc. (NASDAQ/AAPL), the BlackBerry and “Playbook” tablet have proven to be horrible failures, based on my stock analysis.
Based on what I have already seen, from what’s been leaked out on the Internet, the new BlackBerry has the familiar rectangular shape and touch screen feature of many of the most popular smartphones out there. RIM has aligned with many of the big carriers to market this product. The company is also looking at licensing out its software, which would be a first for RIM. The strategy appears to be in place; now we’ll see how the market reacts.
According to my stock analysis, the success of BB10 will likely be the final opportunity for the company to regain market share.
Eric Jackson, the founder of Ironfire Capital, is positive, given RIM’s installed base of around 80 million subscribers worldwide; he sees a price target of $45.00 per share. (Source: Nesto, M., “Blackberry 10: It’s Make or Break for RIM, Says Jackson,” Breakout, Yahoo! Finance, January 28, 2013.) Based on my stock analysis, I’m not as optimistic as Jackson; I want to see how things unfold. RIM will really need to deliver a great product; otherwise, it could be lights out in a few years.
The smartphone and tablet markets continue to be extremely competitive, and I expect this to heat up further, based on my stock analysis.
The question is: can RIM ever regain its former luster? My stock analysis indicates that the company has a long and tough road ahead of it. And while it’s unlikely that it will catch up to Apple, the best-case scenario would be to take some market share away from Apple and the other major players in the market.
And all hope for RIM lies in the acceptance of its BB10 line, based on my stock analysis.
With a great product, RIM could see happier times ahead, according to my stock analysis.
Who knows, I may even consider trading in my “iPhone” for a BlackBerry if I like what I see.
By George Leong, BA, B. Comm.
George Leong, B. Comm. is a Senior Editor at Lombardi Financial, and has been involved in analyzing the stock markets for two decades where he employs both fundamental and technical analysis. His overall market timing and trading knowledge is extensive in the areas of small-cap research and option trading. George is the editor of several of Lombardi’s popular financial newsletters, including The China Letter, Special Situations, and Obscene Profits, among others. He has written technical and fundamental columns for numerous stock market news web sites, and he is the author of Quick Wealth Options Strategy and Mastering 7 Proven Options Strategies. Prior to starting with Lombardi Financial, George was employed as a financial analyst with Globe Information Services. See George Leong Article Archives
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