AmTech Research’s Rob Sanderson bangs the drum on Research in Motion (RIMM) this morning, calling the “best story in tech.” There has “never been a larger, open-ended market opportunity in tech.” RIM will raise guidance as it reports results, Rob says. Numbers will go up, and the stock will soar:
RIMM reports next Wednesday after market close. We are buyers ahead of the print.
We expect the quarter will be inline with the pre-announcement and May guidance will be significantly ahead of consensus.
Market aside, we believe GAAP earnings guidance in the $0.80 to $0.82 range (vs. $0.74 consensus) will get the stock into the $120s. Guidance toward our $0.87 forecast could move the stock into the $130’s â€” we think this is the higher probability scenario.
The other key metric will be subscriber guidance. Anything above 2.5m additions would be very bullish in our view.
We think RIMM is a must-own stock for growth investors. There has never been a larger, open-ended market opportunity in tech and RIMM is very well positioned to be a big player. Although the stock has already had a good move, we would still be buyers ahead of results. Subscriber growth was well ahead of plan this quarter. Channel inventory appears low and handset shipments will catch up next quarter. It seems that neither the inventory replenishment nor the acceleration in adoption is reflected in consensus. We believe RIMM stock will reach our $165 target sometime this year.
Wow. We might quietly suggest that Rob have one fewer cups of coffee before writing about RIM, but we applaud the conviction. AmTech analysts consistently have the balls to lay it all out there, and regardless of what happens with RIM, Rob is certainly no exception.
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