Overheard and overstated
A lot has happened in the world of Research In Motion since my book was published six months ago. Share price is down 38 per cent and some analysts, particularly in the U.S., have gone sour on the stock. The BlackBerry Torch seems to be selling well, but the iPhone 4 may be selling better. Several governments, including India, the United Arab Emirates and Saudi Arabia, have been holding RIM hostage trying to gain access to encrypted email messages for security purposes.
All of this reminds me of the bitter patent battle in 2005-2006 when it appeared RIM was finished because U.S. BlackBerry sales would be halted by a judicial injunction. For months, the crepe-hangers were unavoidable. In the end, RIM came through stronger than ever.
I think RIM will rise again from the current situation. Here’s why. Over the weekend we were in a restaurant and my ears perked up when I heard a nearby table talking about BlackBerry and iPhone. The conversation-stopper was someone who said, “Things have got so bad, I think I’ll short RIM stock.”
Now, let me tell you first of all that I have no time for “investors” who short any stock. But I snuck a look at the speaker, and he might have been twenty. I’m not saying a twenty-year-old can’t have views, but I think when this kind of talk has reached such levels, the worst is over.
But don’t listen to me. Second quarter financial results due to be released this Thursday will provide better food for thought than any restaurant fare.