Credit Suisse raises earnings estimates for BlackBerry maker RIM on smart phone sales growth
By APMonday, June 14, 2010
Credit Suisse raises earnings estimates on RIM
NEW YORK — A Credit Suisse analyst on Monday raised his earnings forecast for Research In Motion Ltd., the maker of the BlackBerry, saying sales of smart phones are rising faster than expected and RIM should be able to defend its market share.
Credit Suisse analyst Kulbinder Garcha said he now expects 250 million smart phones to be sold globally next year, up from a previous estimate of 230 million.
RIM, based in Waterloo, Ontario, had 50.3 percent of the smart phone business in North America in 2009, down from 50.7 percent in 2008 but well ahead of No. 2 Apple Inc., according to market research firm Gartner Inc. Worldwide, RIM has 20 percent of the market. Garcha said he expects RIM to hang onto that 20 percent, with gains overseas compensating for declines in North America.
As a result, he raised his earnings estimate for the fiscal year that ends in February to $5.74 per share from $5.70. He lifted his estimate for the following year to $6.50 per share from $6.35.
Garcha maintained an “Outperform” rating on the stock and a $100 price target. The shares look “inexpensive” compared to projected 2011 earnings and the company’s growth rate, Garcha wrote.
RIM shares were up $1.37, or 2.3 percent, at $60.87 in midday trading.
