Research in Motion Limited (Nasdaq:RIMM) is scheduled to release its 1st quarter 2011 earnings on June 24th 2010. With smartphone market estimates increasing, implied growth of the hand held industry should grow at approximately 45% in 2010 and 31% in 2011. Smartphone growth is driven in large part by strong first quarter volumes across the board, continued commentary from handset vendors and supply chain companies that are driving the low-end of the smartphone market, and the move to tiered data pricing. RIM should maintain global share of 20% in 2010 and 2011 as NA share loss to 42%/38% respectively from 52% in 2009 is offset by international share gains.
Earnings for the prior quarter were 1.27 per share compared to analyst's estimate of 1.28 per share. RIMM reported gross revenues of 4.07 billion dollars, and gross profits of 1.86 billion dollars. Operating income reported by the company is 1.01 billion dollars, and net income was 710 million dollars.
For the first quarter of 2011, analysts expect Research in Motion to earn 1.34 per share, with a high estimate of 1.38 per share and a low estimate of 1.20 per share. For the full year of 2011, the average analyst estimate is for RIMM to earn 5.42 per share, with a high estimate of 6.07 per share and a low estimate of 4.76 per share. The average revenue estimate for the first quarter of 2011 is 4.35 billion dollars with a high estimate of 4.43 billion dollars and a low estimate of 4.19 billion dollars. This compared to a year ago revenue of 3.42 billion dollars. The year over year sales growth is approximately 27.10%
RIMM has recently faced robust competition from Apple, which, with each successive iPhone OS update, is becoming more business oriented. BlackBerry is not the only device on the market anymore that gives you mobile access to your e-mail, and can add value with a calendar and task sheets. RIMM is continuing to develop touch screen phone that can compete with the Iphone but they still have a long way to go.
RIMM is trading close to 61 dollars per share, which is closer to the low end of the 52-week range of 54.30-88.08. The quarter over quarter earnings per share change is 41%, and the three-year earnings per share growth rate is 57%. The sales growth rate from the prior quarter is 18%, while the 3-year sales growth rate is 74%. RIMM has a PE ratio of 14 and currently has zero debt. The company has a market cap of 34.60 billion dollars, with no dividend yield. The annual pre-tax margin for RIMM is 23.6%, and the annual return on equity is 37%.
