Saturday, 21 August 2010 04:04

The BoomBustBlog Multivariate Research in Motion Valuation Model: Ready for Download

On July 29th, I said After Getting a Glimpse of the New Windows Phone 7 Functionality, RIMM is Looking More Like a Short Play. RIM came out with the new Blackberry Torch and OS 6, but I remained unconvinced, and blogged RIM Smart Phone Market Share, RIP?. After some due diligence, I released a full forensic report for my subscribers, wherein I promised to give professional and institutional subscribers access to a plug and play Research in Motion "specific" valuation model that they can use to layer their own market share, penetration, growth and margin assumptions to use our proprietary, internal analytics to produce their own custom valuations. To assist those who don't follow the industry closely, I have also made available an interactive Smartphone Market Model that was built using data from Gartner, Neilson, and Canalys, among other sources.

Before I go on I want to bring to the attention of all how the market is now starting to realize what I have been claiming in my blog, and that is that Research in Motion is flirting with becoming the next Palm, and failing in the market. RIM has fallen farther than its competing handset vendors (both in market share and equity share price) who use Android, iOS and Symbian, and has also underperformed the broad market, and by a very material margin. OTM option prices have jumped significantly, rewarding those who followed the lead on BoomBustBlog.

The following are subscriber downloads and illustrations. Please click here to subscribe or to upgrade your subscription.

The model is written in Excel 2007 and is an abbreviated version of the model that we built for RIMM in house. It has 9 tabs, all of which are listed below except for the first tab which is my contact information. Upon opening the model, you should click the "Assumptions" tab and populate the green cells with the red fonts with the assumptions of  your choice. Feel free to use data and trends from our Smart Phone Market Model to ensure you have the benefit of the clearly delineated historical and rcurrent trends.

RIM Model Assumptions

RIM Model Factors Driving Growth

After populating the assumptions tab, jump to the "Factors Driving Growth" tab and choose the player whose market share and penetration data you want to populate the valuation model for the sake of comparison. The choices are "Nokia", "RIMM", "Apple", "HTC" and "Others". This tab is annual data only.

RIM Model Quarterly Factors (driving growth)

On the next tab, you can do the same as the previous (this tab is quarterly growth). Each of the growth tabs has charts that are print and presentation quality. Just be sure to tell everyone where you got thesis, data and analysis from :-).

Other tabs in the model...

RIM Model Income Statement

RIM Model Device Market Analysis

RIM Model Revenue Analysis

RIM Model Device Revenues

Valuation and Multivariate Scenario Output

Final output is RIMM's valuation using our analytics and your assumptions as input in the assumption tab above, as well as a multivariate scenario analysis showing changes in quite a number of variables (assuming all others remain the same) and their effects on your base valuation, as well as the percentage upside/downside from the current price.

More on the Creatively Destructive Pace of Technology Innovation and the Paradigm Shift known as the Mobile Computing Wars!

  1. There Is Another Paradigm Shift Coming in Technology and Media: Apple, Microsoft and Google Know its Winner Takes All
  2. The Mobile Computing and Content Wars: Part 2, the Google Response to the Paradigm Shift
  3. An Introduction to How Apple Apple Will Compete With the Google/Android Onslaught
  4. This article should drive the point home: 
  5. A First in the Mainstream Media: Apple’s Flagship Product Loses In a Comparison Review to HTC’s Google-Powered Phone
  6. After Getting a Glimpse of the New Windows Phone 7 Functionality, RIMM is Looking More Like a Short Play
  7. RIM Smart Phone Market Share, RIP?
  8. Android is gaining preference as the long-term choice of application developers
  9. A Glimpse of the BoomBustBlog Internal Discussion Concerning the Fate of Apple
  10. Math and the Pace of Smart Phone Innovation May Take a Byte Out of Apple’s (Short-lived?) Dominance
  11. Apple on the Margin
  12. RIM Smart Phone Market Share, RIP?
  13. Motorola, the Company That INVENTED the Cellphone is Trying to Uninvent the iPad With Android
  14. Android Now Outselling iOS? Explaining the Game of Chess That Google Plays in the Smart Phone Space
  15. More of the Android Onslaught: Increasing Handset Revenues and Growth
Last modified on Saturday, 21 August 2010 12:32