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Bernstein Again Says It’s Cheap, Buyout Unlikely

Following up on a note from earlier in the week, Sanford Bernstein’s Pierre Ferragu again makes the case that Research in Motion (RIMM) seems dirt cheap based on the value per subscriber, though he still sees an acquisition as unlikely, with Microsoft (MSFT) the most plausible bidder but currently unwilling.

RIM’s value per sub at its current stock price is just $180 per user, Ferragu notes. He compares that to Microsoft’s $8.5 billion purchase of Skype, announced in May, which valued that company at $50 per user. That’s expensive, writes Ferragu, given “The average Skype user probably isn’t of phenomenal value” at just $5 in revenue, on average.

RIM’s users, by contrast, “generate $60 of service revenue each year and about a third of them are high value, low churn corporate users.” Taiwanese handset maker HTC (2498TW), by contrast, is priced at about $350 per user.

“Unfortunately, we see the transaction as very unlikely: Microsoft still seems convinced that acquiring a hardware business isn’t a good thing, and RIM wouldn’t be an easy buy with the two co-CEOs and Chairmen likely against any such move and controlling well RIM’s board.”

Ferragu maintains an Underperform rating on RIM shares.
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