Research in Motion Ltd. (BBRY): Analysts Bearish on BB10

Research in Motion Ltd. (NASDAQ:BBRY) … er, I mean, Blackberry Ltd. (time to catch up, Google Finance and Yahoo! Finance) has been facing a string of negative news surrounding its BlackBerry devices and its operating system. After 18 months of troubles, the company was launching its new BlackBerry 10 operating system in a hope of re-energizing the brand. And after some initial reports out of the U.K. of brisk sales and even some inventory sell-outs in some retail stores, it seems that the truth may be coming out.

And the truth is, some analysts are feeling pretty bearish about where Research in Motion Ltd. (NASDAQ:BBRY) is going from here. This news comes at perhaps a bad time, as the company is expecting to launch BlackBerry 10 in the U.S. in about two to three weeks. Whatever momentum the company might have gathered in Europe may very well be gone by mid-March in the U.S. with talk of some new smartphone devices coming out in the next couple months – namely, a new Apple Inc. (NASDAQ:AAPL) iPhone, the Samsung Galaxy S4 and some new Microsoft Corporation (NASDAQ:MSFT) Windows Phone devices.

BlackBerry Ltd (BBRY)Research in Motion Ltd. (NASDAQ:BBRY) – I mean, BlackBerry Ltd. – is likely to see its stock fall to $7 per share, according to Michael Genovese of MKM Partners. He went so far as to declare that there is a “90 percent chance” that the new OS will fail. As of 1:30 p.m. Friday, BBRY stock was selling at $13.33 per share, which is down nearly 4 percent on the day. Genovese downgraded the stock to “sell,” citing a decided lack of applications that will lead to the demise of the OS, though MKM likes the OS.

“Without a much larger and popular set of applications to choose from, we believe consumers will have little incentive to switch to (BlackBerry 10) from Android or Apple devices,” Genovese wrote in his note.

What do other analysts say? Their focus was on the sales numbers so far.

A couple of other analysts have been tracking the sales numbers of Research in Motion Ltd. (NASDAQ:BBRY) BlackBerry 10 in the U.K., where the new smartphone launched in January. Apparently, reports of dramatic sell-outs was a bit exaggerated. According to analysts at Canaccord Genuity and Pacific Crest, the sell-outs were more due to low initial inventory and not due to high demand. After expectations of as much as 1.7 million units being sold by the end of the company’s fiscal year March 2, the expectation is that only 300,000 units will be sold, which would mean a fifth consecutive quarter of losses.

In a Canaccord Genuity research note, “Our global surveys post the recent BlackBerry Z10 launch indicated mixed initial sales with limited initial supply cited as the reason for early post-launch stock-outs at some carrier stores rather than overwhelming demand. Our follow-up checks have indicated steady but modest sales levels.”

Over at Pacific Crest, it’s a very similar report in its research note. “We continue to believe the Z10 launch involves relatively small shipment volumes and only moderate sell-through so far in markets which have historically been some of BlackBerry’s strongest. As a result, investor optimism that the BB10 could reverse the company’s trajectory appears to be well overdone at current levels, in our view.”

Have you seen the BlackBerry 10 operating system by Research in Motion Ltd. (NASDAQ:BBRY) – er, I mean, BlackBerry Ltd.? What are your thoughts about it, and do you think the new OS will have a fair shot in the U.S. market when it launches sometime next month? Give us your thoughts in the comments section below.

DISCLOSURE: I own no positions in any stock mentioned.

Please see these related BBRY articles:

Sell the News, or Just Sell?

What a BlackBerry Flop Means for Nokia

This Week’s Dumbest Stock Moves

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

On the Move: The 10 Fastest Growing Businesses in 2015

Fast Money: The 10 Highest Paying Fast Food Restaurants

Mixing It Up: The 14 Best Music Mashups of 2014

Rito Pls Buff: The 10 Least Played Champions in LoL Season 4

10 Covers of Popular Songs that are Better than the Originals

Must See TV: The 9 Most Anticipated Shows of 2015

The 15 Biggest Box Office Bombs of All Time

10 Things The World Can’t Stand About Americans

Picture Perfect: The 6 Smartphones with the Best Cameras

The 10 Best Countries To Work In the World

A Profitable Day At The Track: 5 Tips For Betting On Horses

Tearing You Apart: 6 Bad Habits That Ruin Relationships

Learning on the Job: The 6 Biggest Mistakes Parents Make

Shopaholics Rejoice: The 12 Biggest Malls in the World

Fright Night: 10 Horror Movies Based on True Stories

Mach Mania: The 10 Fastest Jets in the World

Military Heavyweights: The 10 Countries with the Most Tanks

All In: The 7 Richest Poker Players in the World

Abracadabra: The 10 Best Magicians in the World

The 10 Richest Asian Countries in the World in 2014

Eyes in the Sky: 10 Things You Need to Know About Drones

Rising Stars: The 6 Best Silicon Valley Startups

Military Muscle: The 5 Most Advanced Armies in South America

All that Glitters: The 7 Most Luxurious Jewelry Brands in the World

5 Things You Didn’t Know About ISIS but Should

Empowering Your Money: The 5 Best Energy Stocks to Invest In

The 11 Best Android Apps You Can’t Get on iOS

The 10 Most Important International Conflicts in 2014

Mood Enhancers: The 20 Most Uplifting Songs of all Time

Lover Beware: The 8 Countries that Cheat the Most

Breath of Fresh Air: The 25 Countries with the Best Air Quality on the Planet

Singles Beware: The 8 Worst Mistakes Made on First Dates

Healthy and Happy: The 10 Countries with Lowest Healthcare Costs

The 6 Best Company Team Building Activities to Build Workplace Camaraderie

Ships Ahoy: The 10 Busiest Shipping Ports in the World

10 Productivity Tips to Save You Time and Help You Do More With Less

Grab a Bite: The Most Popular Fast Food Restaurants in America

Friday Night Thirst: The 10 Most Popular Cocktails in the World

The 6 Greatest Unsolved Mysteries We May Never Figure Out

7 Useless Products You Never Should’ve Bought

The 5 Reasons Why You’re Single and Miserable

The 7 Most Addictive Foods in the World We Can’t Stop Eating (Even Though We Should)

5 Amazing Places You Can Swim with Dolphins

The Top 7 Most Livable Countries In The World

The 10 Most Expensive Baseball Cards Ever Pulled From A Pack

The 5 Easiest Second Languages to Learn for English Speakers

Silver Spoon: The 6 Richest Families in the World

The 20 Countries with the Largest Prison Populations in the World

The Top 10 Richest Actors in the World

The 10 Best Airline Stocks to Invest In Before They Fly Too High

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!