Early June has been a heady time for gadget lovers, with Palm’s new Pre smartphone going on sale on June 6 and Apple unveiling its updated iPhone 3G S on June 8. Shares of both companies shot up in anticipation of the sexy devices but sold off slightly once the news arrived.
The best bet for investors may be neither stock, however.
Analysts at Goldman Sachs, Citigroup, and Robert W. Baird have all come out in recent days favoring the smartphone maker with nothing new or sexy to release in June: Research In Motion. The maker of the ubiquitous BlackBerry line of smartphones, RIM has been lingering in the shadows this week.
Analysts say checks with wireless retail stores show RIM’s in no need of a sexy new model. Sales of its existing models, such as the touchscreen Storm and consumer-oriented Curve, are running ahead of expectations. It doesn’t hurt that BlackBerrys are available from virtually every major carrier while Apple’s iPhone can only run on AT&T’s network in the U.S. and Palm’s Pre is locked in with Sprint Nextel. Apple faithful are already griping about AT&T’s trade-in prices and delays in offering MMS and broadband tethering features to the new iPhone.
Bold Predictions for RIM
Goldman Sachs analyst Simona Jankowski on June 10 increased her earnings per share estimates for RIM’s fiscal 2010, which ended at the end of May, as well as the upcoming fiscal 2011. Better-than-expected sales and currency market trends are both helping bolster profits, she wrote in a research note. She thinks RIM should earn $5.34 a share, up from her previous estimate of $5.10, for 2010, and $6.45, up from $6.03, in 2011. Jankowski also increased her target price on the stock to $96, after it doubled in the past three months to about $83 a share.
Citigroup analyst Jim…