Analyst Actions: RIM, XL Capital
MORGAN KEEGAN KEEPS OUTPERFORM ON RESEARCH IN MOTION
Morgan Keegan analyst Tavis McCourt notes Research In Motion Limited (RIMM) sees fourth quarter revenues at the midpoint of guidance, while gross margin and EPS are expected to be at the low end of 40%-41% and $0.83-$0.91 forecasts, on continued strength in the U.S. dollar.
McCourt notes RIM's commentary is remarkably similar to February 2008; he expects this implies May will shape up to be another strong quarter. He notes subscriber growth did not revert in May 2008 and channel inventory was rebuilt, leading to substantial uptick in financial trends in May vs. February. He notes although this is not in his estimates, it's a distinct possibility.
He keeps $3.37 fiscal year 2009 (February) and $3.61 fiscal year 2010 EPS estimates.
CITIGROUP KEEPS BUY ON XL CAPITAL
Citigroup analyst Joshua Shanker says he believes XL Capital (XL) needed to prove very little to court speculative investors.
Shanker notes that the company needed to show investment portfolio decline equal to or less than third quarter losses, and to show itself to be a going-concern with client loyalty in the form of retaining a significant amount of business into 2009. He says it succeeded on both counts, despite extreme losses and financial discord.
The analyst expects the stock to rise this morning, although notes that the company sees low- to mid-teen ROE for 2009. He has a $14 price target on the stock.
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