I just finished having an email conversation about Reseach In Motion and the current state of affairs of somewhere in the middle of Canada.
It went somewhat along these lines
CA Analyst "You know, once people realize what morons those guys are for not getting themselves sold it will be on the way back down..."
Me, "Agree about the management team. Its why I call them the "twins"....lol I hate being disrespectful (except in the case of California Analysts), but come on already. By my math, shares have lost over $25 per share just from not doing a deal. That's a lot of ground to make up. The real interesting thing is that with a couple of winner phones, they can be right back at it again.
CA Analyst "I think a RIMM/AMZN partnership is more likely than anything because, obviously, AMZN will do another tablet and probably a phone. But, you've got to think AMZN has also talked to MSFT/NOK. If I am them I move aggressively now to partner with AMZN to go at AAPL a bit."
Me, "Maybe, but investors are likely screwed either way at this point. If you're a buyer knowing that management doesn't want to sell, and they are losing market share what do you do???
You wait it out until management doesn't have a choice and buy it on the cheap. Absent some miracle product everyone loves, its hard to imagine a price over $35 at this point. Six months from now at the rate they are going they lose critical mass and start reporting losses by the third quarter results. They better have free 3D porn on the blackberry 10, or its going to be a long cold winter in Canada next year"
CA Analyst "They're done. Bottom line. The idiots couldn't even get a hockey team to move from Phoenix to Canada. Weak."
I do believe the current pricing has the problems fully priced in or I would not have put on the bullish position today. The sad thing is that to be fully priced in meant I had to wait until the price was so low, I was not risking much premium over the price of the desks, chairs, and patent rights. Maybe they can pull it around and in all fairness, ships the size of RIMM do not turn around on a dime (or on a billion dimes it would appear).
I will perfer to hold the position for at least two to three weeks if the stock can manage to get above and stay above $13.50. Above $14 and I will hold into option expiration day as little to no bad news is expected near term.
It looks like not only Amazon, but Microsoft and Nokia looked at RIM for a merger based on WSJ Online. At least the conversation is shifting. With at least a hope of salvation, shareholders may end up having something of value in their portfolio at the end of the year. Who knows.... maybe RIM will even pull it around and start the long hard climb back up again.
