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Climbing The Wall of Worry

BlackBerry Bulk’s Up Board Is It Long Term or Just Window Dressing? $BBRY

Research in Motion err BlackBerry (Nasdaq:BBRY) announced the appointment of two heavyweight tel con guys.

Richard Lynch, retired executive vice president of Verizon Communications Inc., and Bert Nordberg, former chief executive of Sony Ericsson Mobile Communications.

Richard Lynch was the Chief Technology Officer for Verizon and seems to have a résumé in networks.

Bert Nordberg previous to Sony Ericsson Mobile was head of Ericsson’s Silicon Valley group.

On the surface the two seem to round out the board rather nicely. However nowhere is there a hint of customer user experience leadership. There are a lot of technology guys around. But how many are the generals in winning battles.

Time will tell of course. The newbies need to get up to speed. But it looks like BlackBerry is running out of excuses on the strategic leadership front.

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti or maybe follow his evil twin who is writing a Wall Street Murder Thriller at twitter@georgegutowski

February 7, 2013 Posted by | Black Swans, Board of Directors, Caveat Emptor Perspective, Investments, Stocks, twitter@financialskepti, twitter@georgegutowski, Wall of Worry | , , | Comments Off

Research in Motion Virgins to Volcano or Money in Bank. Board of Director Leadership $RIMM

Big day for Research in Motion (Nasdaq:RIMM) BlackBerry 10 is coming out full frontal. What to think? Probably enough to keep Research in Motion in the game. No longer a smart phone leader but an important segment player. Value investors please note large corporate and government base pays its bills on time.

About two minutes after the launch the question will become whats next? How do we keep this rolling? So does the board have the leadership skills that are needed at the time. Lets take a look at the depth chart. But first remember that this board was packaged up in a crisis and not painstaking assembled over time.

Barbara Stymiest is the chair. Financial background. Economist by training. she headed up Toronto Stock exchange and was senior but not quite top dog at Royal Bank of Canada. A more than competent business women. But her pedigree is managing large dominant financial organizations. She is not a technology type like Marissa Mayer. However as smartphones become electronic wallets replacing cash, debit and credit cards she may be very uniquely suited in guiding Research in Motion. Otherwise in the interim she makes investors comfortable but eventually needs to go.

David Kerr is the wheeler-dealer who has become the elder statesman. Started with Touche Ross worked for the Bronfman Family at Edper and Brascan. holds a few board positions in some Canadian blue chips. Lots of seasoning that makes nervous investors in a crisis comfortable. But has nothing to offer a growing technology concern.

Roger Martin is primarily a very well-respected professor and dean at Rotman School of Business. Some think he is the heir to Peter Drucker as a management guru. Strategic thinking good. Specific thinking about technology, smart phones there is no game.

Prem Watsa some feel is the DNA equivalent to Warren Buffett. His continued support helped stabilize a lot of panicked investors. However Warren Buffett does not sit on the boards of all his investments. He is one step removed and can buy and sell as he wishes. Prem Watsa is really too close to the situation. Even recovering companies hit rough spots. can he always give an honest thumbs up about everything RIM does? We all know it just does not work that way.

John Richardson  has had a stellar career with several of Canada’s largest financial institutions. But at the age of 80 does he have the outlook the a growing tech company needs.

John Wetmore in addition to RIMM sits on the board of Loblaws and some philanthropic entities. He was the former President and Chairman of IBM Canada. But IBM Canada and RIMM are not exactly peas in a pod. Expertise and skills are not the best fit.

Timothy David Dattels seems to be very involved with Asian Affairs. He does not seem to have the big hook ups in Asia that could benefit RIMM. He was part of the fire brigade that responded to the crisis.

Claudia B. Kotchka has the only resume that I liked. She formerly was  Vice President-Design Innovation & Strategy by Procter & Gamble Co. But P&G is consumer oriented. I don`t think Research in Motion has a mass market orientation. at least not now.

Antonio Pedro de Carvalho Viana-Baptista has an extensive background with telephone companies in Latin America primarily. At this point I don`t see RIMM talking about any strengths in Latin America.

So basically the current board is the fire brigade that showed up in a rush and panic. This is not the board to lead to serious wealth maximization. Best of luck with the Blackberry 10 but you need to change out the board.

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti or maybe follow his evil twin who is writing a Wall Street Murder Thriller at twitter@georgegutowski

 

January 30, 2013 Posted by | accounting problems, Behavioural Investing, Black Swans, Board of Directors, Caveat Emptor Perspective, Governance, Investments, Stocks, Take Over Targets, twitter@financialskepti, twitter@georgegutowski, Value Investing, Volatility, Wall of Worry | , , , , , | Comments Off

RIM to become a venture capital vehicle $RIMM $IBM $GOOG $MSFT

Image representing Research In Motion as depic...

Image via CrunchBase

Think about it Research in Motion (Nasdaq:RIMM) should become a venture capital outfit. Here’s how and why:

  1. No outstanding debt and about $2 billion in cash and equivalents
  2. Client base continues to grow and create positive cash flow
  3. Patents have huge valuation. Sell and create huge war chest.
  4. In house R&D does not work so why not buy new ideas?
  5. Maybe go private and become mysterious without idiotic press scrutiny.

George Gutowski writes from a caveat emptor perspective. Follow his twitter feed @financialskepti

August 27, 2012 Posted by | Black Swans, caveat emptor, Caveat Emptor Perspective, Financial Engineering, Free Cash Flow, Investments, M & A, Share Buy Back, Shareholder Activist, Stocks, Take Over Targets, Wall of Worry | , | Comments Off

Research in Motion Turtle Like Moves? $RIMM

Image representing Research In Motion as depic...

Image via CrunchBase

Research in Motion (Nasdaq:RIMM) announced drastically reduced earnings for Q4. Market reaction has taken a page or two from chicken little “the sky is falling” and then again for emphatic emphasis “the sky is falling”. Lets take a rationale look at some of the major issues.

  1. The new CEO just arrived 10 weeks ago. By the way he is looking for a new COO and the good news is he thinks he is close to hiring a new Chief Marketing Officer. Not to mention Jim Balsillie has just resigned from the board. The generals are still changing out. The guys that are leaving probably were not pushing at the wheel. Actually this was a good thing as most would agree they were not the winning team.
  2. Hey they only lost $128 million.  That ain’t nothing but a chicken wing in the technology space. This only begs the question. Big change holds hands with big write-offs. The year-end was just closed off. That means this year will see more pain and financial agony. The new guys will be hired not to protect the status quo. By the way inventories are up clocking in at $1 Billion. Can you see some write-offs coming.
  3. The only good thing is the large increase in their cash position moving some $610 million to $2.1 Billion. This is the necessary set up move for solution. The new whatever will cost big bucks. Watch for continued cash hoarding over the next few quarters. When they start drawing down cash will signal the back field is in motion. The earnings release led with this point. Subliminal advertising designed to encourage the deep value investor.
  4. The cash position is roughly equal to 30% of RIM‘s market cap.
  5. No discussion about the value of patents and intellectual property. Of course if management starts hammering in this point it would confirm they are holding themselves up for sale.

So given the cash position would you pay approximately $4 Billion for the operating assets with substantial cash flow and all the intellectual property.

George Gutowski writes from a caveat emptor perspective

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March 29, 2012 Posted by | Black Swans, Caveat Emptor Perspective, Disclosure, Due Diligence, Earnings Forecasts & Guidance, Investments, M & A, Stocks, Take Over Targets, Value Investing, Volatility, Wall of Worry | , | 1 Comment

Research in Motion stealth take over. It clever, very clever.$RIMM $RY

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Image via CrunchBase

Research in Motion (Nasdaq:RIMM) announced the supposed rearrangement of chairs on the Titanic. The two senior guys  Balsillie and Lazaridis announced that they will be stepping down tomorrow. They will still be on the board and they will still continue to hold huge personal investments in Research in Motion.

The key critical chess move is the appointment of former Toronto Stock Exchange chief Barbara Stymiest will become chairman of the board of directors. Ms. Stymiest has been a director since 2007. Royal Bank of Canada (NYSE:RY) had previously hired Ms. Stymiest to a new role of chief operating officer during a management overhaul in 2004 after a slump in the U.S. eroded profit at the bank. She was responsible for “strategic development,” with all corporate areas reporting to her, including finance and risk management.

Fortune magazine named her one of the 50 most powerful women in global business three times from 2006 to 2008, and she was named one of the “25 Most Powerful Women in Banking” in 2008 by American Banker.

Forget about the iPhone consumer battles. Research in Motion is all about security. Many countries want to access Blackberry networks internal systems so they can spy on supposed internal enemies. American and Russian security types have spoken very well of Blackberry security strength.

This strength in security is important to financial institutions and credit card operators. So with Ms Stymiest sitting at the top who is the very best to maximize shareholder wealth including Lazaridis and Balsille.

Hedge fund activists who want a strategy to compete with iPhone and other smart phones do not know what they are asking for.

George Gutowski writes from a caveat emptor perspective.

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January 22, 2012 Posted by | Black Swans, Caveat Emptor Perspective, Disclosure, Due Diligence, Investments, M & A, Shareholder Activist, Stocks, Take Over Targets, Wall of Worry | , , , | Comments Off

Visa American Express or MasterCard will buy $RIMM Security the leading edge for smartphone transactions $AXP $V $MA

RFID chip pulled from new credit card

Image via Wikipedia

Who will buy Research in Motion (Nasdaq:RIMM)? The conversation does not want to stop. The real question is “Why buy RIMM?” What would the strategic reasons be?

Look at the camera technology in a smart phone. It’s not really there to take cute pictures of your cat. The business case is in the scanning or optical character recognition. The smart phones will scan bar codes, QR’s and other bits of digital data resulting in products being purchased.

So imagine your charge card as a smartphone or your smartphone as a charge card. Who runs charge cards Visa, MasterCard and American Express (NYSE:AMP) for the most part. RIMM market cap has shrunk enough for the three credit card companies to swallow up RIMM. Credit card companies are a technology play. Who could benefit the most from RIMM. The other two could not catch up for five years or more.

RIMM still has the security card.

This is the only takeover that would be palatable to the two founders and co-chairman. A takeover by another technology giant would be unthinkable to them.

George Gutowski writes from a caveat emptor perspective.

November 3, 2011 Posted by | Black Swans, M & A, Take Over Targets | , , , | Comments Off

Either Visa, American Express or MasterCard will buy $RIMM. Security the leading edge for smartphone transactions. $AXP $V

UPC-A barcode

Image via Wikipedia

Who will buy Research in Motion (Nasdaq:RIMM)? The conversation does not want to stop. The real question is “Why buy RIMM?” What would the strategic reasons be?

Look at the camera technology in a smart phone. It’s not really there to take cute pictures of your cat. The business case is in the scanning or optical character recognition. The smart phones will scan bar codes, QR’s and other bits of digital data resulting in products being purchased.

So imagine your charge card as a smartphone or your smartphone as a charge card. Who runs charge cards Visa, MasterCard and American Express (NYSE:AMP) for the most part. RIMM market cap has shrunk enough for the three credit card companies to swallow up RIMM. Credit card companies are a technology play. Who could benefit the most from RIMM. The other two could not catch up for five years or more.

RIMM still has the security card.

This is the only takeover that would be palatable to the two founders and co-chairman. A takeover by another technology giant would be unthinkable to them.

Disclosure: George Gutowski writes from a caveat emptor perspective.   

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November 3, 2011 Posted by | Black Swans, Earnings Forecasts & Guidance, Investments, M & A, Stocks, Take Over Targets | , , , , , | Comments Off

$RIMM Music app is ready. Who cares? Make me safe then I care. #Blackberry #iPhone

Image representing Research In Motion as depic...

Image via CrunchBase

Research in Motion (Nasdaq:RIMM) says its music app is ready. Did you hear that the music app is ready. So what and who cares? RIMM is about secure messaging for corporate environments and then some stuff for the CIA and governments that RIMM will  not talk about. But we think it pays well. If you need music from your smart phone you have already made a decision and it wasn’t Blackberry. If you are a spy with the CIA or someone lie that you do not have an official Facebook page or even a twitter account. 

RIMM needed to throw something out there to shut some critics up. It will not become a major money-maker.

There is still the need for strong security. The world has hackers hiding out in the bandwidth. Play the security card and make me feel safe. Music apps not important.

Disclosure: George Gutowski writes from a caveat emptor perspective. It’s all about the black swans. 

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November 3, 2011 Posted by | Black Swans, Due Diligence, Earnings Forecasts & Guidance, Stocks, Volatility | , , | Comments Off

$RIMM offers free Apps. Read about clever enterprise strategy in play. #apps #smartphone

Image representing Research In Motion as depic...

Image via CrunchBase

Research in Motion (Nasdaq:RIMM) is offering free apps to individual users. They are also offering free tech support to enterprises customers. Apologies are so manic-depressive. The real trick is to not have a repeat problem. Enterprise customers who use the tech support will hopefully shut up internally about the Blackberry problems.

Blackberry needs to win back their approval and support. If your internal IT people keep referring to Blackberry as that sh*t product you will eventually switch.

Not much communication on what the costs are moving forward or what the costs are looking backward. Too much stone walling. The Carl Icahn attention chills senior officers so you hunker down and say as little as possible.

Disclosure: George Gutowski writes from a caveat emptor perspective. I hath not positions in stocks mentioned in this post. I hath not plans to initiate new positions within the next 72 hours. 

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October 17, 2011 Posted by | Class Action, Disclosure, Earnings Forecasts & Guidance, Reg FD, Stocks | , , , | Comments Off

$RIMM unreliable network thwarts takeover #blackberry #iPhone #carlicahn #jaguarfinancial

Image representing Research In Motion as depic...

Image via CrunchBase

Research in Motion (Nasdaq:RIMM) continued service problems have hit the third day. Customers are clearly upset and the brand has less value. At the same time Carl Icahn and maybe Jaguar Financial are attempting to secure proxy power to straighten out management and supposedly create more wealth.

Vic Alboni does not know how to fix this problem. The service outage is a nuts and bolts operating issue. The question becomes why is the network so unstable. Selling this or rebranding that will not solve this mess. As the problem goes on for the third day it clearly is serious and not just one lose connection somewhere.

If as and when James Balsillie and Michael Lazaridis fix the problem they will be able to spin the issue in their favour, arguing that the Vic Alboni’s and Carl Icahn’s would not know what to do and therefore should not be listened to.

Disclosure : George Gutowski writes from a caveat emptor perspective. Readers should always have a caveat lector perspective. I hold not any positions in stocks mentioned in this post. I hath no plans to initiate new positions within the next 72 hours.

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October 12, 2011 Posted by | Disclosure, Earnings Forecasts & Guidance, Investments, Investor Relations, Reg FD, Shareholder Activist, Shareholder Litigation | , , , , , , | 1 Comment

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