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Rally in RIM Shares

The tab for its options probe looks comfortingly small.

Research in Motion (RIMM) shares jumped Wednesday as restatement concerns appeared to wane.

The BlackBerry maker will miss its Friday financial filing deadline, but says it plans to present a final report on its stock option accounting on Monday. Shares of the Waterloo, Ontario, tech shop rose 2% Wednesday after dropping 5% in a widespread market selloff Tuesday.

Bulls were encouraged that the conclusion to an internal audit of its stock option accounting appears imminent. The company has estimated that it will make an adjustment to its books of somewhere between $25 million and $45 million, to correct accounting errors related to stock option expenses.

"We find this to be a rather insignificant amount," American Technology Research analyst Rob Sanderson wrote in a note Wednesday. "This is also a fraction of what other high-growth tech companies have been reporting, with



$2.2 billion being the largest."

RIM fans are optimistic that once the accounting inquiry is closed, the market will be able to focus more on the success of the company's phones. Strong demand for the consumer targeted BlackBerry Pearl has helped pump sales and bolster analysts' earnings expectations.

Sanderson is particularly bullish about RIM's new crop of phones, including the Pearl and a new, slimmer 8800 email phone. The analyst says the Pearl and 8800 will find even more demand as the models move beyond the GSM telcos like T-Mobile and


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"We are still early in this current cycle," Sanderson writes.

Still, pessimists point to RIM's business email specialty and the limited appeal the added costs have to consumers. Also, the impending release of


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iPhone is likely to be seen as a

threat to other makers of high-priced phones including RIM.

RIM shares were up $2.30 to $141 in midday trading Wednesday.