Research in Motion, Ltd. (RIMM)

Closed July 5, 2007 $216.19
Closed 102.38 with 3:1 split $307.14
30 percent increas

52 wk Range:
39.92 - 137.01
Volume:
15,720,332
Avg. Vol (3m):
27,190,100
Market Cap:
56.37B
P/E (ttm):
65.84
EPS (ttm):
1.53

We believe RIM has the potential for further upside momentum. For this reason RIM continues to be included in our best stock group. Although the Blackberry 9000 plans have not been sufficiently fleshed out it appears that RIM is being embraced by the population segment previously expected to purchase the I-Phone. Its ease of use and the I-pod saturation has led this segment of the population to embrace the Blackberry.

RIM continues to trade at a premium to peers with a 7.6x FTM EV/sales (average = 2.3x) and a 34.8x FTM P/E (average = 19.5x).

Recent sampling indicates that RIMM has experienced sequential momentum declines but does continue to sit near historic highs on market share, shipment growth, customer anticipation of new products and customer satisfaction.

The BlackBerry continues to score at historic highs on being the best selling smartphone. BlackBerry is at a minimum matching the iPhone as the phone of choice for text messaging youth.

An economic slowdown has the potential to impact Research In Motion. It is estimated that one-third of RIM's customer base works in the financial sector.

For a company trading at a high P/E multiple, upside surprises or increased guidance are mandatory, in order to have a sustained share price advance.

BlackBerry 9000 Launch

The Blackberry 9000 could be commercially released early in the second calendar quarter of 2008. The 9000 model must be successful to sustain share price advance over the next few quarters.

This phone will feature a HSDPA-capable device with a touch screen interface, similar to the Apple (AAPL, $182.22) iPhone. It will be be GPS and Wi-Fi enabled with a conventional keyboard. It is not clear whether this product will have a full keyboard and appeal to the business user or the casual user.

It appears that whether BlackBerry targets the non-business consumer or the business consumer this product will be embraced by the non-business consumer. The Blackberry is becoming the phone of choice for text messaging youth.

For this reason RIM is considered to be a top performer with an extensive upside potential.


Google, Inc. (GOOG)

Closed July 3, 2007: $534.34
Closed December 10, 2007: $694.50
23% increase.
52 wk Range:
437.00 - 747.24
Volume:
5,182,202
Avg. Vol (3m):
6,365,490
Market Cap:
217.13B
P/E (ttm):
54.29
EPS (ttm):
12.78

Equity Stock Analysis believes Google, Inc. has significant upside potential. Google continues to be a strong growth stock in light of their announced plans for the development of their on-site power plant and the exploitation mobile ad market through their own hardware, partnered hardware and the potential for their own 700MHz bandwith.

Mobile advertising opportunities extend and build upon Google’s core search marketing business. This is the most optimum venue for growth. Mobile advertising has the potential for growth similar to the adoption of the Internet via PCs from late 1990s until now. On a worldwide basis Google generated $1 annually per installed base of PC in '02 ($6 in US) and is expected to generate $19 in '07 ($37 in US) due to higher penetration of Internet and more users & usage of Google search/other services.

Apple, Inc. (AAPL)

June 21, 2007 - $123.90
December 10, 2007, $194.21
36% Increase

52 wk Range:
76.77 - 196.83
Volume:
30,925,621
Avg. Vol (3m):
37,610,900
Market Cap:
167.95B
P/E (ttm):
48.80
EPS (ttm):
3.93

Apple’s revenue growth is vulnerable to a slowdown in the US economy. However it appears that the growth of the iPhone in China and Europe will have a halo effect on all Apple Products including the Mac. Apple is considered to continue to have significant upside potential.

Apache Corp. (APA - NYSE)

April 26, 2007 -- $74.42
December 13, 2007 – $106.47
Thirty percent increase

52 wk Range:
63.01 - 107.73
Volume:
3,850,075
Avg. Vol (3m):
3,498,230
Market Cap:
35.28B
P/E (ttm):
15.70
EPS (ttm):
6.757
Div & Yield: 0.60 (0.60%)

Apache Oil was recommended at $74.52. The $100.00 range is viewed as a point with limited upside based on the activities in Tierra del Fuego. The oil stocks have in our opinion surged on speculation and may be due for a correction. The Tierra del Fuego success may not be sufficient to provide a significant upside for Apache Corp.

Sirius Satellite Radio (SIRI)

May 15, 2007 -- $2.73
December 13, 2007 -- $3.14
13 percent increase

52 wk Range:
2.66 - 4.26
Volume:
31,320,507
Avg. Vol (3m):
42,377,100
Market Cap:
5.01B
P/E (ttm):
N/A
EPS (ttm):
-0.45

SIRI is no longer viewed as having upside potential. The risks are wholly viewed as outweighing any potential gain.

XM Satellite Radio (XMSR)

May 14, 2007 -- $10.62
December 13, 2007 -- $13.99
24 percent increase

52 wk Range:
10.37 - 17.70
Volume:
8,702,091
Avg. Vol (3m):
6,184,200
Market Cap:
4.40B
P/E (ttm):
N/A
EPS (ttm):
-2.33

XMSR is no longer viewed as having upside potential. The risks are wholly viewed as outweighing any potential gain.