SG Cowen Ups Research In Motion Rating

Analyst Robert Stone says the company's rollout of a less expensive handheld model should lead to broader adoption of its devices

SG Cowen upgraded Research In Motion (RIMM ) to market perform from underperform.

Analyst Robert Stone says the company's new lower-cost 2.5G BlackBerry mobile phone/e-mail device should retail for about $300 compared to $500 for current models. He thinks the lower cost is essential for broader adoption, while the company should be able to maintain similar gross margins to the current model. Stone says news of the BlackBerry model with Verizon is likely to appear next week; licensing deals with one or more handset makers is also possible. He notes new software includes key features that were absent in previous models. Stone sees a 65-cent fiscal 2003 (Feb) loss, and a 30-cent fiscal 2004 loss.

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