Jefferies analyst Peter Misek said that the research firm estimates that Research In Motion Ltd (NASDAQ:BBRY) (TSE:BB) will deliver more than 3 million units of BlackBerry 10 for the May quarter compared with Street expectations of less than 3 million.
The research firm observed that sales for the BlackBerry Z10 are slowing, but some businesses are still evaluating. On the other hand, sales for the BlackBerry Q10 are better than expected and he projected that Research In Motion Ltd (NASDAQ:BBRY) (TSE:BB) will likely increase its build plans due to the BlackBerry Q5 and possible greater than expected global demand for the BlackBerry Q10.
The Canadian smartphone manufacturer released its BlackBerry Q10 in Canada and the United Kingdom last month, and experienced a wide sell-out and generally limited stocks in some areas. T-Mobile launched the device in the United States last Wednesday, June 5.
Wall Street analysts estimated that the Canadian smartphone manufacturer will deliver more than 3 million units for the August quarter, but Misek believed that the figure is “materially higher.”
According to Misek, sales of the BlackBerry 7 are declining more than expected, but he emphasized, “this will be EPS positive as Research In Motion Ltd (NASDAQ:BBRY) (TSE:BB) loses money on each BB7 device…we believe sub losses will be in line with guidance (6% to 9% or 3M to 5M).”
Misek believes that the free BBM for Android and iOS could help strengthen and increase the relevance of Research In Motion Ltd (NASDAQ:BBRY) (TSE:BB)’s ecosystem. “We see some possibility that BBRY could be a viable competitor to highly-valued WhatsApp.” The BBM on Android and iOS is free.
The research firm also observed that a third ecosystem is becoming solid between Research In Motion Ltd (NASDAQ:BBRY) (TSE:BB) and Microsoft Corporation (NASDAQ:MSFT). Its latest survey showed that 43 percent of participants believe that the third ecosystem is BlackBerry while 48 percent responded it is Microsoft.
Misek also believe that opportunity behind mobile device management (MDM) of Research In Motion Ltd (NASDAQ:BBRY) (TSE:BB) is under-appreciated. He pointed out, “BES10 is currently being widely trailed by corporations and we think the MDM software will gain traction throughout this year and see a significant ramp in revenues this year.”
Firm Gives Buy Rating To Research In Motion Ltd (BBRY):
Jefferies Equity Research recommended a buy rating for shares of Research In Motion Ltd (NASDAQ:BBRY) (TSE:BB) with a price target of $22 per share. The stock price of the company is slightly up at $13.77 per share on Friday, around 2:03 P.M. in New York.