RIM shares hit 7 year low as analysts cut forecasts
BlackBerry maker RIM’s share price has fallen to its lowest level for seven years as analysts cut their profit estimates and the company admitted some customers are having trouble with their BlackBerry Bold devices, reports Bloomberg. RIM’s stock fell 4.6 percent yesterday to close at US$17.36 on the New York Stock Exchange - its lowest price since May 2004 - meaning its stock price has dropped 70 percent in 2011.
RBC Capital Markets analyst Mike Abramsky blamed slower sales and lower earnings projections on his decision to lower his stock price target from US$29 to US$23 in an analyst note. Abramsky also lowered his sales estimate for the current quarter by US$100 million to US$5.3 billion and profit per share from US$1.28 to US$1.20.
JMP Securities LLC analyst Alex Gauna, also quoted by Bloomberg, cut his stock rating for the company to “market underperform” and reduced his profit estimates in response to increasing competition from Android devices.
RIM also admitted in an emailed statement that some BlackBerry Bold 9900 (pictured) and 9930 devices have failed to switch on. According to Bloomberg the company said it is working to fix the issue with a software update. RIM is relying on the Bold and a clutch of other new devices to reverse the drift of consumers towards the iPhone and Android smartphones.