Research In Motion Ltd (BBRY): Who’s Shorting This Stock?

I don’t have anything against Kantar’s research. What I stand against, however, are the conclusions that were made. Some analysts wrote off BlackBerry exclusively on this report, forgetting that BlackBerry is bigger than the U.S. If anything, Nokia’s global market is buffed up by its feature phones.

Headway in other key markets bigger than U.S.

In key markets such as India, bigger smartphone competitor Apple Inc. (NASDAQ:AAPL) has launched a discount program that, so far, has impacted sales positively. In fact, analysts expect Apple’s sales in India to double to more than $1 billion by the end of the fiscal year. The iPhone maker is giving 25% discount on the older iPhone 4 models through an iPhone exchange program. What Apple has to worry about however is Samsung. The South Korean tech giant has also introduced an equally formidable discount program. In an attempt to bolster its India sales for key products, Samsung is spending millions to publicize its 15% discount on its prime products.

This recurrent tussle between Samsung and Apple has inevitably created a leeway for BlackBerry. As Apple and Samsung get embroiled in their timeless war, BlackBerry will have sufficient time to tout its new cheap data plan for Indian states. The cheap data plans will be sold for older Curve and Bold models, allowing the Ontario-based smartphone maker to maintain a leash on its middle and lower segment market share.

India aside, BlackBerry has a lot of opportunity in Africa. Recently compiled statistics show that BlackBerry’s African market share in the first quarter of 2013 was 10.2%, compared with 4.34% at the onset of 2013. In most parts of Africa, BlackBerry still has cool brand perception — cooler than an iPhone to a sixteen year old. If BlackBerry can offer cheap data plans, along with other budget propositions to Africa, it can greatly widen its addressable market.

Conclusion

Forget what the critics say — most of it represents the interest of short traders. BlackBerry’s resurgence will hold despite the lingering negative rumors that have given it the by-name ‘rumors in motion’. The Ontario, Waterloo-based handset maker is a strong buy for long-term investors.

The article Why You Should Ignore the BlackBerry Shorts originally appeared on Fool.com and is written by Lennox Yieke.

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