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Analysts are looking at the same numbers, but drawing vastly different conclusions about the future of Research In Motion Ltd. RIM-T

On Tuesday, in the latest flurry of analysis of the BlackBerry maker, two investment firms published research notes, one rating RIM a $50 (U.S.) stock and a sell and the other deeming it at $100 stock and a buy.

Both bulls and bears on the company agree that a wave of new competition is about to hit the wireless handset market, but they differ in the assessment of how RIM will weather it.

Time to sell?

Pierre Ferragu, of Sanford C. Bernstein & Co., says the company is poised to disappoint.

“Although we believe Research In Motion will continue to gain share in the handset market and deliver good top-line and earnings growth, we believe the company is unlikely to match current investor expectations in the near future, as further volume growth will come at a cost in terms of [average selling price] and profitability,” he wrote.

Mr. Ferragu pointed to three areas where he thinks the company is vulnerable to new competition: distribution, pricing power, and return on capital.

The biggest challenger to the BlackBerry, Apple Inc.'s AAPL-Q iPhone, is becoming more widely available as more phone companies get access to the device. In Canada, for example, Bell Canada BCE-T and Telus Corp. T-T will both begin selling iPhones this week, breaking Rogers Communications Inc.'s RCI.B-T stranglehold.

Greater distribution of the iPhone is going to cost RIM between 5 per cent and 13 per cent of its sales, the analyst estimates.

In terms of pricing power, Mr. Ferragu argues that RIM is losing it. “RIM's e-mail isn't unique any more,” he says, pointing to “push” e-mail technology of Nokia Corp. NOK-N and Google's GOOG-Q Android software. As RIM's competitive advantage fades, its margins will suffer.

“Of course, BlackBerry can restore to some extent this declining pricing power by adding up more features to its solution, and a good example of this would be the recent success of Blackberry messaging. But there is nothing tangible today that positions RIM better than any other handset manufacturer on that front, so we find it difficult to make it a strong investment case.”

Another mark against RIM today is that its business model is more capital intensive than its competition, Mr. Ferragu claims. This is the results of two decisions: The company spends a lot on licensing other firms' intellectual property and it invests in its own expensive network and infrastructure that involves massive operating centres to handle wireless traffic.

He thinks RIM is shifting from a company in the midst of great innovation, to one serving the mass market with high volumes of handsets. Over the next three years, he forecasts that RIM could manage growth of about 11 per cent a year.

Mr. Ferragu has an “underperform” on the stock and cut his price target to $50 from $60.

Jim Balsillie, the co-chief executive of Research in Motion.

Time to buy?

At the other end of the spectrum, Richard Tse, of National Bank Financial Inc., is reeling off reasons to buy RIM shares, reiterating on Tuesday his $100 target.

“Sentiment is downright scary on this stock,” he admits in a research note, but the negatives have been “priced in,” he says.

His five reasons to buy include the stock's current valuation, new company initiatives in the works to fix perceived weaknesses, future upside from the business market for BlackBerrys, future upside from the international markets, and – the whopper – RIM may be a takeover target.

RIM shares are trading at just 11.2 times Mr. Tse's earnings estimates for next year, while RIM's share profit is expected to grow between 20 per cent and 25 per cent in 2011. “This valuation is looking a bit obscene,” he says.

In the weeks and months ahead, he thinks RIM will release improved software, including a better browser, and will show improved cost savings through greater volume of sales.

While demand for BlackBerrys in the corporate market continues to be sluggish in the weak economy, Mr. Tse sees a significant market opportunity ahead for RIM when conditions improve.

At the moment, RIM generates only 30 per cent of its business from outside North America. That leaves tremendous potential beyond, and he estimates that in the next few years international sales could drive annual share profit from $5.25 to nearly $7.00.

Mr. Tse's kicker is his speculation that at its recent share price, RIM becomes a more attractive takeover target.

“We hate recommending stocks on this, but the lower it goes… the more susceptible it becomes – to a takeout. In our view, that should offer some downside protection on the stock,” he wrote.

And who would come knocking? For one, Microsoft Corp. MSFT-Q , which would love to notch up its offerings to the business world, Mr. Tse said.

In trading Tuesday, RIM shares gained about 3 per cent. They had fallen nearly 7 per cent the previous session after analyst Jim Suva of Citigroup Global Markets Inc. downgraded the stock to a “sell” on expectations of greater competition.