With shares of Research In Motion down almost 70 percent in the last year and a recent upgrade of the stock, “Mad Money” host Jim Cramer has finally taken his ‘sell’ rating off the beleaguered BlackBerry-maker.
Cramer changed his mind after reading the research from Bernstein, which upgraded RIM to ‘market-perform’ from ‘underperform’ on Tuesday. He thinks the analyst, Pierre Ferragu, has been right every step of the way on RIM , from the time he initiated coverage in October of 2009 with a sell rating to his recent upgrade.
Ferragu doesn’t think the fundamentals have gotten any better, Cramer said, but at this point all the negatives have been baked into the stock price. Plus, RIM has become so cheap, the analyst thinks the downside has become minimal.
It is also possible an activist shareholder could push for a “much needed” change in management. Or the company could be taken over by someone like HTC or Microsoft .
Bernstein doesn’t think a takeover is likely, Cramer said, but the possibility is enough to make shorting the stock way too risky at these levels.
“The Bernstein analyst is right: RIM did get cheaper as it went down,” he said. “It has nearly $3 of cash per share on the balance sheet, a huge installed base of customers, and a lot of valuable intellectual property.”
Cramer's bottom line: While RIM is not a buy right now, it is no longer a sell.
"I fear someone will rattle the cage and move it up, or that some company might be stupid enough to buy them," he said.
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