While most people seem to think Research in Motion is a lost cause, Citi analyst Jim Suva has suddenly turned bullish upgrading the stock from a sell to a buy this morning.
Why the change of heart on RIM? Because of Nokia’s partnership with Microsoft.
As Nokia transitions to Windows Phone 7, Suva thinks carriers will abandon promotional support for Nokia and its dead platform in favour of RIM, helping to drive sales (at least in the near term).
Here’s his full explanation from a Citi note. (He has an $80 price target on the stock.):
We are upgrading Research In Motion (RIMM) to Buy from Sell. Carrier “Promotion Commotion” should start to flip to benefit Research In Motion at the expense of Sell-rated Nokia (CIRA analyst Zahid Hussein). Nokia is completely changing its strategy to now embrace the Microsoft mobile operating system thereby creating a multi quarter gap in Nokia products & carrier promotion support. We met with several international carriers at Mobile World Congress in Barcelona Spain this week who commented on their forthcoming shift to promote other handset OEMs (Android, Apple & RIMM) until Nokia’s product strategy is more realizable. Nokia currently has 35% global market share vs. 23% Samsung, 9% LG, 5% Apple, 4% RIMM, 3% Motorola, 3% Sony Ericsson, 3% HTC (4Q’10).