A financial analyst on Thursday said Research In Motion is continuing to struggle with lackluster sales of its BlackBerry phones.
In a research note, Jeffries analyst Peter Misek said it’s possible the Canadian company could be the bearer of bad news early by announcing its quarterly results for the period ending March 3 before their scheduled release date on March 29.
Jeffries analysts lowered their fiscal year 2013 earnings per share estimate on RIM to $1.87 from $2.00, cut their price target on the stock to $12.00 from $15.00 and reiterated an “Underperform” rating.
“We believe RIM is experiencing significant volume deceleration and that BB7 devices are seeing a significant slowdown,” Misek wrote, commenting on competition in the market for smartphones. “Older devices are also slowing in all markets as Huawei, ZTE and Lenovo price very aggressively in their markets. According to carriers we checked with, for $150 unsubsidized (free when subsidized) people can get a solid Android 2.3 device that is better than most Blackberries.”
The analysts believe RIM is struggling with sales of both low-end and high-end devices and that the anticipated launch of Apple’s iPhone 5 ahead of BlackBerry 10 handsets could cause further harm. Jeffries cited decreasing sales of low-end devices in Europe towards the end of the quarter, a bad sign considering that RIM has been fairing decently outside the United States.
“We believe higher-end handsets are doing poorly outside of Enterprise sales with continued iPhone 4S and Android momentum (especially Samsung) causing issues,” Misek added.
RIM also is expected to encounter even more fierce competition from Nokia handsets that incorporate Microsoft’s Windows operating system.