UBS Downgrades RIM, Lowers Price Target

UBS (UBS) analyst Phillip Huang reduced his price target on shares of Research In Motion (RIMM) to $18.00 from $26.00 in a research note issued to investors on Monday. Huang also reduced by $3 billion his fiscal 2013 revenue estimate of the co. to $17.4 billion from $20.4 billion, and lowered $0.86 his EPS estimate to $3.87 from $4.73. The UBS analysts reiterated his “Neutral” rating on the BlackBerry maker’s stock that closed Friday at $16.77.

RIM shares, currently trading at $16.22 , are nearly 80% below their 2011 February 52-week high of $70.24.

Separately, at least four brokerages — CIBC, Nomura, Barclays, and Baird — also cut their price targets on RIM’s stock on Monday saying continued negative sentiment will likely keep the PPS of the Waterloo, Ontario-based co. depressed in the near-term.

Pacific Crest analyst, Brad Erickson, pointed out in a research note that “The stock may see some near-term support from value seekers but ultimately….RIMM [is] a classic value trap and [its] fair value [is] closer to $10-$12 per share.”

RIM, whose franchise value and enterprise hold continues to diminish, on Friday said it no longer expects to meet its full-year earnings forecast due to weak sales and an inventory pile up of its PlayBook tablet. Canada’s smartphone maker continues to have a difficult time selling its BlackBerry PlayBook ever since the device first launched seven months ago.

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About Ron Haruni 1068 Articles
Ron Haruni is the Co-Founder & Editor in Chief of Wall Street Pit.

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