On Thursday after the close chatter on the Street had everything to do with Research in Motion and whether the beleaguered stock had finally bottomed out.
Bullish speculation was triggered by the stock’s action in the aftermarket – it sold off as much as 7% on weaker than expected earnings but then pared most of those losses.
“The fact that the stock bounced back in the after market and that it wasn’t lambasted may be a sign that the worst is over,” speculates Fast Money trader Guy Adami.
Initially the market’s knee jerk reaction was sell, after Research In Motion reported a $125 million loss in the quarter or 24 cents a share. That was down from net income of $934 million, or $1.79 a share, in the year-earlier period.
However, shares recovered during the conference call, especially after the company confirmed that it will release new BB10 phones toward the end of calendar 2012. And new CEO Thorstein Heins said the company is "committed to reclaim share" in the enterprise market.
Also, on the earnings call, “they talked strategic partnerships,” notes Fast trader Tim Seymour.
He thinks RIM is starting to realize that it may need to sell itself or form a major alliance. “I think the market expects RIM to unlock value by looking at what the parts are worth. For this stock, it's all about figuring out strategic options,” he says.
Trader Joe Terranova just can’t get behind the thesis – not even as a sum of the parts story let alone a turnaround story.
“Where are all the activist investors – why is it there no Carl Icahn?” Terranova asks. He thinks most of the marquis activists are staying away because they realize the company faces too many fundamental challenges for its fortunes to change.
With Apple gaining share in the enterprise market and RIM’s inability to gain any kind of foothold in the tablet market, Terranova thinks the path of least resistance is lower. “I think RIM trades down to $10,” he says.
What do you think? We want to know!
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Trader disclosure: On Mar 29, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Joe Terranova is long VRTS; Joe Terranova is long NXPI; Joe Terranova is long IBM; Joe Terranova is long MCD; Joe Terranova is long EMC; Joe Terranova is long MSFT; Joe Terranova is long JOY; Joe Terranova is long OXY; Joe Terranova is long LQD; Guy Adami is long C; Guy Adami is long GS; Guy Adami is long INTC; Guy Adami is long AGU; Guy Adami is long MSFT; Guy Adami is long NUE; Guy Adami is long BTU; Tim Seymour is long BAC; Tim Seymour is long INTC; Tim Seymour is long CSCO; Tim Seymour is long FCX; Michael Murphy is long AKS; Michael Murphy is long BAC; Michael Murphy is long AND; Michael Murphy is long JOY; Michael Murphy is long PHM; Michael Murphy is long LPX
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