Research In Motion Ltd. (RIM) reported strong y-o-y growth in 1Q 10 revenues. However margins declined y-o-y given a significant increase in the cost of goods sold. Furthermore, Management guidance for 2Q 10 does not indicate a significant improvement in performance during the quarter. Hence, given the current price levels, we downgrade RIM's NASDAQ common stock from a BUY to a SELL over our 6-24 month investment horizon. We will reassess the NASDAQ common stock rating for RIM in the coming weeks. Although the current target price does not support a SELL rating, as we now a expect significant negative currency impact on the Canadian stock over the next 6-24 months and given our fundamental outlook, we downgrade the Canadian stock from a BUY to a SELL. We will reassess the Ticker: RIM.TO Canadian stock rating for RIM in the coming weeks.

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