TSC Ratings' Updates: Research In Motion

The following ratings changes were generated on Monday, Dec. 29.

We've downgraded Research In Motion (RIMM Quote), which engages in the design, manufacture and marketing of wireless solutions for the mobile communications market worldwide, from buy to hold. The primary factors that have impacted our rating are mixed. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.

Research In Motion's very impressive revenue growth greatly exceeded the industry average of 17.6%. Since the same quarter one year prior, revenues leaped by 66.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.

RIMM's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, RIMM has a quick ratio of 1.63, which demonstrates the ability of the company to cover short-term liquidity needs. ...