Zacks.com Likes RIM

RIM is ranked as #2 buy stock at Zacks.com. Here is what they say about RIM.

As you probably remember, the company beat expectations 2 weeks ago and the stock soared in response. Since then, 23 analysts have raised their fiscal 2010 profit projections. Eight analysts also upped their fiscal 2011 forecasts.

To understand why this happened, it is important to realize that prior to RIMM's report, earnings estimates had been trending down. In fact, the trends suggested the company would miss expectations. There were fears that the recession was hurting Blackberry sales. (Not to mention the ongoing competitive threat from the iPhone and a growing number of alternatives from other manufacturers.)
Research in Motion calmed these fears with better-than-expected profits, good sales of new, higher-end handsets and record levels of net new subscribers. The combination of this bullish news and the expectations for a bearish report caused the stock to rally and analysts to raise their forecasts.

Though you may be worried about having missed the big move in RIMM, positive earnings estimate revisions tend to lead to outperformance over a period of 1-3 months. This means that the stock could continue to rise, or at least generate a better return than the overall market. Furthermore, our telecom analyst, David Weissman, thinks the stock deserves to trade at $70 per share - a premium to current price.