By Euan Rocha
TORONTO | Fri Jan 18, 2013 12:06pm EST
(Reuters) - Shares of Research In Motion Ltd (RIMM.O)(RIM.TO) rose more than 6 percent after an influential analyst raised his rating on the stock on Friday, saying that RIM's new BlackBerry 10 operating system performed as well or better than rivals in recent tests.
Jefferies & Co analyst Peter Misek, who lifted his stock rating on RIM to "buy" from "hold," believes Wall Street is now underestimating the strength of RIM's financial performance for the coming quarters after the new devices debut on January 30. He also lifted his price target on RIM to $19.50 from $13.
The move pushed RIM shares up 6 percent to $15.80 in morning trading on the Nasdaq, while its Toronto-listed shares rose 7 percent to C$15.72.
RIM hopes that its re-engineered line of touch-screen and keyboard devices will win back market share lost to rivals such as Apple Inc's (AAPL.O) iPhone and devices powered by Google Inc's (GOOG.O) market-leading Android operating system.
Misek, who has been skeptical for some time about RIM's odds of engineering a turnaround, said recent trials of BB10 test devices showed vast improvements over its existing smartphones.
"Recent tests and demos have shown a solid browser, smooth touch interface, and intuitive navigation. We now believe the operating system performance could be better than or equal to Android Jelly Bean and likely on par with iOS 6," said Misek, referring to the latest versions of software powering Android and Apple devices.
Shares of RIM, which fell as low as $6.22 in September, have more than doubled in value over the last four months as the BB10 launch approaches.
In November, Misek had upgraded RIM's stock to "hold" from "underperform," arguing that his checks revealed greater carrier support for BB10 than expected.
Misek's last upgrade had propelled RIM's shares into double-digit territory for the first time in five months and his latest upgrade pushed the stock to a new 11-month high.
In his latest note, Misek said: "More recent checks indicate that carriers have also agreed to volume commitments for the first two quarters post-launch."
Earlier this month, some top U.S. mobile carriers including Verizon Communications (VZ.N), AT&T Inc (T.N) and T-Mobile USA (DTEGn.DE) signaled that they would support RIM's BlackBerry 10 products.
And earlier this week media reports indicated that Aircel and Vodafone Group Plc (VOD.L) are gearing up to market the new BB10 devices in India, which has long been a strong growth market for RIM even as it has ceded ground in North America and Europe.
Misek said BB10 global orders have risen to between 1 million and 2 million a month from about 500,000 a month in early December. He now views initial sales of 4 million BB10 devices a quarter as "not a high hurdle."
Additionally, developer support is proving to be stronger than expected, Misek said.
"Our checks indicate that large app developers are going to put resources into developing BB10 apps," he said. "Previously, we had thought they would take more of a wait-and-see approach before committing resources."
RIM has faced criticism in the past for lacking a strong suite of high-quality apps.
RIM has said its new platform will boast business focused apps from Cisco WebEx and SAP among others, along with music, movie and gaming apps.
Social networks LinkedIn, Foursquare, Twitter and Facebook will all have apps for BB10 at launch, according to RIM. It will announce some of its other app partners on the launch date.
(Reporting by Euan Rocha; Editing by Gerald E. McCormick, Jeffrey Benkoe and Leslie Gevirtz)