Working overtime at the rumor mill
When a company has so much critical information behind closed corporate doors, people begin to speculate on what might be happening. Here, BlackBerry followers rise to the occasion with both bulls and bears guilty of this rumor building. Remember when a partnership or buyout by Lenovo Group Limited (PINK:LNVGY) was imminent? Analysts began to see Research In Motion Ltd (NASDAQ:BBRY) as an ideal partner for the Chinese electronics maker to move into the smartphone business. The feasibility of this deal was brought into question since a sale of BlackBerry to a Chinese company would pose a security threat to governments that use BlackBerry devices, something the Canadian government could potentially block.
Being a Chinese company has both its positives and negatives for Lenovo Group Limited (PINK:LNVGY). On one hand, it has a prime spot in an emerging market where the government tends to favor homegrown companies over foreign ones. However, as the Research In Motion Ltd (NASDAQ:BBRY) rumor experience demonstrates, Lenovo Group Limited (PINK:LNVGY) could have a tough time making foreign acquisitions due to a distrust of the Chinese government by foreign regulatory bodies. But even after Lenovo Group Limited (PINK:LNVGY) played down the rumor, it surfaced again weeks later only to die off once again as Lenovo largely ignored it and it was swamped by other BlackBerry related news.
While a lot of analyst reports on BlackBerry have been unfavorable, the report by Detwiler Fenton created the least favorable image of Research In Motion Ltd (NASDAQ:BBRY). The report asserted that BB10 phones were being returned faster than they were being sold, a terrible trend for BlackBerry if true. However, both BlackBerry and Verizon denied such rumors, and BlackBerry even requested that the SEC look into Detwiler Fenton’s reporting.
For at least another week
Research In Motion Ltd (NASDAQ:BBRY) shares are not for the risk-adverse, conservative, or volatility-fearing investor. Shares have been on a wild ride facilitated by a shortage of actual news and a surplus of analyst reports. The volatility has has seen more swings in recent weeks as the Q1 earnings report approaches and analysts make last-minute adjustments to their numbers. Next Friday we will have the Q1 numbers. And you can bet the analysts will be all over those ones.
Alexander MacLennan owns shares of Research In Motion Ltd (NASDAQ:BBRY). This article is not an endorsement to buy or sell any security and does not constitute professional investment advice. Always do your own due diligence before buying or selling any security. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple Inc. (NASDAQ:AAPL).
The article At Least Another Week of This Analyst War originally appeared on Fool.com.
Alexander is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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