Ironfire Capital’s Eric Jackson says he still has reservations about Research in Motion, but is no longer shorting the stock because he thinks the company’s new BlackBerry 10 platform could represent new market opportunities. During the time shares of Research in Motion fell from nearly $150 in 2008 to current levels near $7, observers generally fell into two camps; those who unabashedly supported the Waterloo device maker, and those who bashed it.
Ironfire Capital’s Eric Jackson would, for much of the past five years, have fallen into the latter group. Jackson, who is a regular contributor to Forbes, where he has documented RIM’s demise, began shorting the stock when it was more than $50, and has never held a long position.
Today, however, he says the negativity about RIM may be overdone. Appearing on BNN with host Marty Cej during the network’s coverage of RIM’s annual general meeting, Jackson says he is now thinking about buying shares of the BlackBerry maker.
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On a day when RIM shareholders, in a lecture hall on the campus of Wilfred Laurier University in Waterloo, mocked the board for not addressing its competitive position earlier, Jackson said RIM would be better served to adopt a strategy that pursues licensing opportunities for its upcoming BlackBerry 10 platform, rather than try and engage in a device war.
Jackson says he is still worried by the leadership of new RIM CEO Thorsten Heins, describing him as “one of the worst communicating CEOs” he has ever seen. “Heins has said some boneheaded things” he says, offering that a “series of comical catchphrases” has provided fuel for those mocking RIM’s demise. Jackson, critiquing Heins first six months at the head of RIM, pointed out that even people he had talked to who were working on BlackBerry 10 didn’t know why the operating system was delayed. “Either Heins is stupid” he says, “or he was kept in the dark.”
Still, says Jackson, RIM’s cash position is strong and should easily bring it to the BlackBerry 10 release where there is a real market opportunity for the new RIM platform to power a range of smart devices. This strategy, he says, would have RIM play in a place where it could be “unchallenged” and is something he considers much more attractive for RIM shareholders than competing against iPhones and Android devices.
Jackson says he will be watching RIM carefully as the BlackBerry 10 release, which is expected in January, nears. Until then, he says, those buying RIM might have to suffer through Q2 numbers that could be awful. He suggests waiting until this bad news is out of the way before tying up capital that could be better served in places other than RIM stock.