RIM Tumbles Below $10 a Share, Lowest Since December 2003
Research In Motion Ltd. (RIM) fell to the lowest level since 2003, marking four days of declines since the struggling BlackBerry maker forecast an operating loss and said it had hired banks to explore strategic options.
RIM declined 5.8 percent to $9.66 a share at the close in New York, for the lowest price since Dec. 22, 2003. The stock has slumped 93 percent from its mid-2008 high of $147.55.
RIM said May 29 that it may report a quarterly loss for the three months that ended June 2, stung by a “high” rate of customer defections in the U.S. The operating loss would be the first since 2004 for the Waterloo, Ontario-based company, according to data compiled by Bloomberg.
“The stock had hung in better than I expected after the pre-announcement and maybe we’re now seeing people that had not sold amid the early pressure, doing so,” said Matt Thornton, an analyst at Avian Securities LLC in Boston. He has a neutral rating on the stock.
Faced with pressure from shareholders to improve performance, RIM last week said it had hired JPMorgan Chase & Co. (JPM) and RBC Capital Markets to help the company evaluate its options. Its share of the global smartphone market fell by more than half last quarter to 6.4 percent, according to research firm IDC, as its aging lineup of BlackBerry phones failed to keep pace with Apple Inc. (AAPL)’s iPhone and newer products based on Google Inc. (GOOG)’s Android operating platform.
Store checks indicate that sales of BlackBerry devices in the U.S. probably fell in May from a month earlier, Jim Faucette, a Pacific Crest Securities Inc. analyst, said today in a client note.
“It is going to get worse for Research In Motion,” said Faucette, who rates the stock equivalent of a sell.
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