UPDATE: Citigroup Reiterates Sell Rating, Raises PT on Research In Motion Limited
In a report published Friday, Citigroup reiterated its Sell rating on Research In Motion Limited (NASDAQ: RIMM), and slightly raised its price target from $5.00 to $6.00.
Citigroup noted, “Santa delivered early Christmas for RIMM holders as the stock has rallied 90% in the past few months but investors were surprised during the earnings call that the company's highly profitable services were going to materially & structurally shift lower with the coming new BB10 products. After hours RIMM stock initially traded up 10% as the company announced earnings that were not as bad expected with sales of $2.72b above consensus of $2.67b & EPS loss of -$0.22 above consensus of -$0.35. However, as the earnings call progressed it became clear that RIMM is going to receive much lower rates on its highly profitable services (on the new BB10 products) causing the stock to drop 12% after hours. While this was a major focus for the Q&A during the call, RIMM was unable to quantify the risk.”
Research In Motion Limited closed on Thursday at $14.12.
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