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Opinions Patrick Horan
BlackBerryBB.TOCOMMENTJan 10, 2014
Patrick HoranStock price when the opinion was issued
As of Jun 12, 2026. Market Open.
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The guidance was weak, and BB faces numerous challenges. But the company is still undergoing a strategic review, following overtures for a takeover. This remains a possibility, but it is hard to endorse on that alone. Fundamentals remain weak and much worse than expected. The balance sheet is OK but its large cash cushion is gone. Cash flow has been negative the past two years. Speculative as a possible takeover, but not really endorseable as a long term holding right now.
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Premium contentBB is now trading at 4.4x times' Price/Sales. In 4Q-2023, the company’s revenue declined by -18.4% to $151M, in line with the estimates and EPS is -$0.02, beating estimates of -$0.07. The balance sheet is okay, with net debt of $17M. However, the trailing twelve-month cash flow is concerning, as the company generated -$263M.
The company announced a strategic reveiw which has given shares some support but we wouldn't view it as coming from a posiiton of strength and are not sure we see a whole lot of reason to be excited here.
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Premium contentThe forgotten Canadian cell phone developer has re-invented itself in the cybersecurity space and is investing heavily into AI technology - partnering with Amazon's web services. Although operating at quarterly loss, cash reserves are growing and it trades at under 2x book. We recommend placing a stop-loss at $4.25, looking to achieve $8.00 -- upside potential over 33%. Yield 0%
(Analysts’ price target is $8.03)
Their long-term vision is very elusive because of the change in management. This is a rebirth, the ability for new management to position the company and to talk about what it is going to do. From what he can see, they are going to be very much more a niche product versus a consumer product, which would be a very good thing. The question is, how do they define that niche and what inroads will the competition make as they are trying to define themselves. Right now you have a very large Short position and a lot of scared Shorts so he would think there is some upside in the short term. If you see a 20% gain from here, Sell and move on.