RIMM Earnings Miss, Market Futures Tank
Posted by Blain Reinkensmeyer
June 25, 2008 at 9:39 pm
This past Sunday I asked the question, Is RIMM Tech’s Last Breadth? It seems the answer may be “yes”.
NASDAQ futures have dropped heading into the market open tomorrow (Thursday) as the BlackBerry maker tanked after disappointing earnings.
Research in Motion (RIMM) reported after the market close and immediately free fell even after doubling its revenue to $2.24 billion from $1.08 billion last year. The reason for the slide was a disappointing forecast that left investors questioning the tech giant’s future.
Below you can see a screenshot of RIMM stock today and the impact the earnings had in after hours trading:
Click to ViewThis in turn has caused the market futures to tumble as fears of a recession continue to overtake investors minds. Below is a screenshot of the QQQQ which tracks the NASDAQ 100 market index. Notice the slide after the bell:
Click to ViewThe reason I posted last Sunday on RIMM stock was because RIMM was one of the few remaining tech stocks still trading near highs. Investors were holding onto the belief that a big earnings report could trigger a broader rally, proving that maybe the economy wasn’t so bad after all. Now with RIMM set to gap down at the opening bell tomorrow and no tech stocks left to lead the only index, “holding it together” the future seems bleak.
It’ll be interesting to see how the Naz responds tomorrow. 8% down in AH may translate to 10-12% down for the stock tomorrow tomorrow. Isn’t it like 2-3% of the weighting of the Naz? RIMM may be pulling an AAPL and doing the whole “under promise, over deliver” thing with forecasting. Unless we drop into a full-blown recession, which it seems like a lot of people are trying pretty hard to avoid, I don’t see why RIMM shouldn’t keep growing strong.
The earnings miss was negligible, and you have to wonder how recently the earnings were adjusted upwards given the run they’ve had over the past couple months. .39/sh to .84/sh is great growth.
130 has held up pretty well since May, and support at 120 goes back further. I’d be surprised to see the stock stay below $125 for long unless the overall market hits some serious turbulence.
Looks like it’s 3.95% of the QQQ according to Y! Finance…
My God are those TD Ameritrade charts? If you have not heard of QuoteTracker, check it out. Ameritrade charts suck!
[...] well the Dow broke below January lows shedding nearly 360 points, Research in Motion (RIMM) missed earnings guidance and tanked 13%, GM shares plunged to a 53 year low, and Oil closed at a record high [...]
Hawk,
What indicators on QuoteTracker work well for you for seeing momentum buying and selling?
You definitely called this one…