Monday, September 29, 2008

Research In Motion 2

I bought some Research In Motion (TSX-RIM) at end of 1999 and in the first part of 2000. I paid some $12,800 for this stock. I have since sold off about $30,000 (when it has split), and I still have some left. With the current decline in price, it is not worth that much anymore. However, according to Quicken, I have still made an average annual return of some 22.8% on this stock.

Since I had already sold stock with more than 2 times what I paid for RIM, I have made good money on this stock. Even if RIM goes to zero, which I very much doubt, I will still have made good money on this stock. RIM is still my favorite tech stock. It is the only one I still have. (Because we went into a rough (or volatile) market, I made sure that I was mostly invested in good solid dividend paying stock.)

This stock has been good for my overall portfolio. However, RIM is not, has never been, a buy and hold type of stock. If it does really well again, I will sell more. If it does not, I would not have lost anything. At the moment, I have updated my spreadsheet, and I am just waiting for the market to sort itself out again.

The P/E on this stock was quite high, but this ratio has come down a lot with the price crash. Also, the Earnings per Share (EPS) estimates have come down since the May 2008 quarterly report. The Accrual Ratio has gone even higher as the Operation Cash Flow is a lot lower than the net income. This stock crashed in the last bear market, and now it has crashed again. However, it is still a lot higher than in the last bull market.

Debt for this company is very much under control. The Return on Equity (ROE) is still very good. The cash flow, revenue and earnings are not as strong as they were. However, this is a Tech stock, and technology can change very rapidly. Some analyst have put a Hold rating on this stock, but most are still in the Buy to Strong Buy rating range.

RIM designs, Manufactures and markets wireless solutions for the mobile communications market. The company is famous for the Blackberry. It is an international company with offices in North America, Europe and Asia-Pacific. Its site is at See my spreadsheet at I have reloaded it with the data from May 2008 quarterly report. The stock reports in US$.

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website at for a list of the stocks for which I have put up spreadsheets on my web site.

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