Research In (Slow) Motion (Train Wreck)

The same machinery (Wall Street) that brought you collateralized mortgage bonds, CDOs, SIVs, Enron and WorldCom will no doubt be falling over themselves in the morning with the usual ridiculous upgardes and fresh new price targets for shares of Research In Motion (RIMM) after their "stellar" earnings report after markets closed in the U.S. tonight. The company reported sequential revenue growth (since its last quarter ending Sept.1 2007) of 21.81% and revenue growth since its quarter ending March 3rd, 2007 of 79.8%. Growth in "Net Income" was 28.8% and 97.1%. Pretty good, huh? Meanwhile, "Trade Receivables," "Other Receivables" and "Other Current Assets" (most likely factored receivables) grew from $654.4-million at quarter-ending March 3rd to $1.243-billion at quarter-end, Dec. 1, 2007--a 90% increase. The $653.15-million increase in receivables since its March ending quarter compares to its $742.1-million increase in reported revenues. All but $88.95-million of its increase in revenues since March 3, 2007 can be attributed to RIMM's selling into its retail channel. Absent some good old channel stuffing, Research In Motion is in effect just Research In (Slow) Motion (Train Wreck).