Research In Motion Ltd Stock Hold Recommendation Reiterated (RIMM)

NEW YORK (TheStreet) -- Research in Motion (Nasdaq:RIMM) has been reiterated by TheStreet Ratings as a hold with a ratings score of C. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.

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Highlights from the ratings report include:

• RIMM has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, RIMM has a quick ratio of 1.61, which demonstrates the ability of the company to cover short-term liquidity needs.
• Net operating cash flow has slightly increased to $1,050.00 million or 4.52% when compared to the same quarter last year. Despite an increase in cash flow, RESEARCH IN MOTION LTD's average is still marginally south of the industry average growth rate of 11.56%.
• The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Communications Equipment industry. The net income has significantly decreased by 113.4% when compared to the same quarter one year ago, falling from $934.28 million to -$125.00 million.
• Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. When compared to other companies in the Communications Equipment industry and the overall market, RESEARCH IN MOTION LTD's return on equity is below that of both the industry average and the S&P 500.

Research In Motion Limited designs, manufactures, and markets wireless solutions for the mobile communications market worldwide. The company has a P/E ratio of 4.7, equal to the average telecommunications industry P/E ratioand below the S&P 500 P/E ratio of 17.7. Research in Motion has a market cap of $5.45 billion and is part of the technology sector and telecommunications industry. Shares are down 28.3% year to date as of the close of trading on Friday.

You can view the full Research in Motion Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

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