RESEARCH IN MOTION NDQ-RIMM RECENT

PRICE 168.27 P/ERATIO 38.1(Trailing:

Median: NMF) P/E RATIO 1.95 YLD
50.4 RELATIVE DIV’D
Nil VALUE
LINE
TIMELINESS 1 Raised 9/22/06 High:
Low:
31.6
3.4
87.9
11.6
38.6
6.9
14.8
4.2
35.5
5.4
103.6
33.0
84.6
51.0
142.7
61.0
169.6
119.8
Target Price Range
2010 2011 2012
SAFETY 3 Raised 3/17/06 LEGENDS
. . . . Relative Price Strength 320
TECHNICAL 5 Lowered 6/8/07 2-for-1 split 6/04
Options: Yes
BETA 1.45 (1.00 = Market) Shaded area indicates recession 200
2010-12 PROJECTIONS 160
Ann’l Total 2-for-1 120
Price Gain Return 100
High 270 (+60%) 13%
Low 180 (+5%) 1% 80
Insider Decisions 60
J A S O N D J F M
to Buy 0 0 0 0 0 0 0 0 0 40
Options 0 0 0 0 0 0 0 0 0
to Sell 0 0 0 0 0 0 0 0 0
% TOT. RETURN 5/07
Institutional Decisions THIS VL ARITH.
2Q2006 3Q2006 4Q2006 STOCK INDEX 18
Percent 120 1 yr. 155.9 22.2
to Buy 115 152 176 shares 80
to Sell 145 110 143 3 yr. 177.0 56.5
traded 40
Hld’s(000) 128479 137966 140994 5 yr. 2096.8 97.2
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 © VALUE LINE PUB., INC. 10-12
-- -- -- -- -- -- .16 .37 .60 1.41 1.87 1.99 3.22 7.13 11.11 16.35 24.75 30.70 Revenues per sh AB 45.00
-- -- -- -- -- -- .01 .07 .11 .11 .07 d.16 .58 2.54 3.11 3.90 5.35 6.70 ‘‘Cash Flow’’ per sh 9.40
-- -- -- -- -- -- .01 .05 .08 .06 d.05 d.36 .31 2.11 2.53 3.33 4.80 6.15 Earnings per sh ABC 9.00
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- Nil Nil Div’ds Decl’d per sh Nil
-- -- -- -- -- -- .04 .07 .17 .44 .47 .26 .12 .58 .96 .85 .80 .80 Cap’l Spending per sh .75
-- -- -- -- -- -- .01 .84 2.19 5.77 5.56 4.57 9.29 10.47 10.75 13.40 18.10 24.20 Book Value per sh 45.00
-- -- -- -- -- - - 127.94 128.52 142.27 156.54 157.58 154.34 184.83 189.49 186.00 185.74 188.00 190.00 Common Shs Outst’g D 200.00
-- -- -- -- -- -- -- -- NMF NMF -- -- NMF 31.8 27.9 28.8 Bold figures are Avg Ann’l P/E Ratio 25.0
-- -- -- -- -- -- -- -- NMF NMF -- -- NMF 1.68 1.49 1.56 Value Line Relative P/E Ratio 1.65
estimates
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- Avg Ann’l Div’d Yield Nil
CAPITAL STRUCTURE as of 3/3/07 20.9 47.3 85.0 221.3 294.1 306.7 594.6 1350.4 2065.8 3037.1 4650 5830 Revenues ($mill) AB 9000
Total Debt $6.6 mill. Due in 5 Yrs $6.6 mill. 3.7% 16.2% 17.4% 1.8% NMF NMF 15.4% 33.6% 31.3% 30.0% 29.5% 29.5% Operating Margin 28.0%
LT Debt $6.3 mill. LT Interest $0.5 mill. 1.5 2.8 4.7 8.6 17.7 30.4 54.5 66.8 85.9 85.0 85.0 85.0 Depreciation ($mill) 80.0
(Less than 1% of Cap’l)
Leases, Uncapitalized: None .4 6.4 10.5 8.5 d7.0 d55.5 51.8 414.5 493.1 634.5 915 1185 Net Profit ($mill) 1800
No Defined Benefit Pension Plan 41.7% 25.9% 34.5% 53.3% -- -- -- 2.2% 21.4% 26.4% 25.0% 25.0% Income Tax Rate 25.0%
1.7% 13.5% 12.4% 3.9% NMF NMF 8.7% 30.7% 23.9% 20.9% 19.7% 20.3% Net Profit Margin 20.0%
Pfd Stock None 1.2 92.5 275.1 796.3 677.8 275.8 1146.5 913.5 977.9 1377.4 2200 3100 Working Cap’l ($mill) 6000
-- -- 6.5 6.3 11.9 5.8 6.2 6.5 6.9 6.3 6.0 6.0 Long-Term Debt ($mill) Nil
Common Stock 185,741,000 shs.
1.2 107.5 311.4 902.9 876.7 704.7 1716.3 1983.7 1998.8 2488.2 3400 4600 Shr. Equity ($mill) 9000
29.6% 6.0% 3.3% 1.0% NMF NMF 3.0% 20.8% 24.6% 25.5% 27.0% 26.0% Return on Total Cap’l 20.0%
MARKET CAP: $31.3 billion (Large Cap) 29.6% 6.0% 3.4% .9% NMF NMF 3.0% 20.9% 24.7% 25.5% 27.0% 26.0% Return on Shr. Equity 20.0%
CURRENT POSITION 2004 2005 3/3/07 29.6% 6.0% 3.4% .9% NMF NMF 3.0% 20.9% 24.7% 25.5% 27.0% 26.0% Retained to Com Eq 20.0%
($MILL.) -- -- -- -- -- -- -- -- -- -- Nil Nil All Div’ds to Net Prof Nil
Cash & ST securities 947.6 635.1 987.2
Receivables 240.9 347.1 612.8 BUSINESS: Research In Motion Limited develops and manufac- Berry hand-held devices. Research & development: 7.7% of fiscal
Inventory (FIFO) 92.5 134.5 255.9 tures wireless hand-held devices and radio modems, and provides 2006 sales. Has about 6,254 employees. Officers & directors own
Other 263.2 139.9 63.4
related services, for mobile computing and data communications. about 16% of common (5/07 Renewal form). Co-CEO: Jim Balsillie.
Current Assets 1544.2 1256.6 1919.3
The company’s BlackBerry services allow users to send and re- Pres. and Co-CEO: Mike Lazaridis. Incorporated: Ontario. Address:
Accts Payable 68.5 95.0 130.3
Debt Due .2 .3 .3 ceive e-mail and access personal information functions, including 295 Phillip Street, Waterloo, Ontario N2L 3W8. Telephone: 519-
Other 562.1 183.4 411.3 calendars, address books, and task lists, from its portable Black- 888-7465. Internet: www.rim.net.
Current Liab. 630.8 278.7 541.9
Research In Motion’s stock price vance of roughly 25% and a bottom-line in-
ANNUAL RATES Past Past Est’d ’03-’05 jumped almost 25% since our March crease of 25%-30%.
of change (per sh) 10 Yrs. 5 Yrs. to ’10-’12 report, reflecting strong growth in the In May, RIMM introduced the Black-
Revenues -- 55.0% 30.0%
‘‘Cash Flow’’ -- 85.0% NMF mobile communications market. The pri- Berry Curve smartphone, a small, light
Earnings -- 94.0% NMF mary driver is its strong BlackBerry prod- model with a large display, easy-to-use
Dividends -- -- Nil uct line, which is distributed worldwide by keyboard, and trackball navigation sys-
Book Value -- 28.0% 22.0%
a growing number of wireless carriers. tem. Features include a camera, media
Fiscal QUARTERLY REVENUES ($ mill.) AB Full
Year Fiscal RIMM is experiencing robust demand for player, and web browser, as well as Black-
Begins May Per Aug.Per Nov.Per Feb.Per Year its BlackBerry Pearl smartphone, a slim- Berry email and messaging capabilites.
2004 269.6 310.2 365.8 404.8 1350.4 profile model with a camera and music The balance sheet is solid with $1.41
2005 453.9 490.1 560.6 561.2 2065.8 player functions. The company continues billion ($7.61 a share) in cash assets, in-
2006 613.1 658.5 835.1 930.4 3037.1 to hold a dominant position in the enter- cluding $426 million in long-term invest-
2007 1050 1100 1215 1285 4650 prise market, despite rapidly changing ments, and practically no debt. Healthy
2008 1345 1385 1480 1620 5830 technology and aggressive competition. finances give the company the flexibility to
Fiscal EARNINGS PER SHARE ABCE Full
Year Fiscal Business metrics stay positive. Bene- invest in new products and technology.
Begins May Per Aug.Per Nov.Per Feb.Per Year fiting from the momentum in the wireless These shares are top ranked for rela-
2004 .36 .45 .59 .71 2.11 messaging market, RIMM added 1.02 mil- tive price performance over the next
2005 .56 .61 .71 .65 2.53 lion BlackBerry subscribers during the six to 12 months (Timeliness: 1). The
2006 .68 .74 .93 .99 3.33 February quarter, expanding the total sub- high ranking reflects the positive mo-
2007 1.06 1.11 1.26 1.37 4.80 scriber base to about 8.0 million, and es- mentum of earnings in recent periods and
2008 1.38 1.42 1.53 1.82 6.15
timates that it added over 1.1 million sub- the strong uptrend in the stock price over
Cal- QUARTERLY DIVIDENDS PAID Full scribers in the May interim. the past 12 months. Investors, however,
endar Mar.31 Jun.30 Sep.30 Dec.31 Year We are forecasting revenue growth of should keep in mind that trading in the
2003 over 50% for fiscal 2007 (ends Febru- shares can be volatile, as denoted by their
2004 NO CASH DIVIDENDS ary, 2008), following the 47% advance in low Stock Price Stability rating (15 out of
2005 BEING PAID fiscal 2006. Our forecast also calls for 100) and their relatively high Beta coeffi-
2006 share-profit expansion of nearly 45%. For cient (1.45).
2007 fiscal 2008, we are projecting a top-line ad- Lester Ratcliff June 15, 2007
(A) Reporting currency: U.S. dollars. Data (B) Fiscal year ends Saturday closest to the charges: ’00, $0.08; ’01, $0.11; ’02, $0.53; ’04, Company’s Financial Strength B++
through 8/31/99 restated from Canadian dollars last day of February of the following calendar $1.02. Next earnings report due early Jul. (D) Stock’s Price Stability 15
to U.S. dollars, using the 8/31/99 closing ex- year. (C) Canadian GAAP. Diluted earnings. In mill., adj. for split. (E) Sum of qtrs. may not Price Growth Persistence 70
change rate of C$1.488 per U.S.$1.00. Excludes amortization. Excludes extraordinary equal ann’l total due to rounding. Earnings Predictability 20
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