Jefferies Discusses Research In Motion

Jefferies & Co. is out with a research report on Research In Motion Limited RIMM, and it has a Buy rating on shares. In a note sent to investors Jefferies writes, "Build plans for the Feb Q are increasing due to Torch, Pearl, and emerging market Curve strength. Also, a mystery SKU is beginning to appear. This could be early demo units of a QNX-based handset called Storm 3. Our Feb Q estimates of $5.57B/$1.72 are above the St's $5.45B/$1.61." Jefferies goes on to say, "Lower-cost Android phones have recently appeared internationally for $300-$350 wholesale vs. prior $400-$500. 1) RIMM's $150 ASP for the 8520/8530 in emerging markets and prepaid is half the cost of any Android solution. 2) We believe low-to-mid-tier Android phones are mainly taking share from Nokia (NOK, $9.87, Underperform). 3) BBM and pin to pin is free on most carriers. Android does not have an equivalent. 4) Due to network load many of emerging market telcos do not have the capacity to fully support Android (e.g., Bharti Airtel in India)." Shares of RIMM lost 8 cents yesterday to close at $61.29.