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Opinions Benj Gallander
BlackBerryBB.TOHOLDAug 26, 2014
Benj GallanderStock 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)
The key in this case is the horse and the jockey. He likes John Cheng, who has a good track record. This is going to be a long haul. There are very few companies that have more noise about them. His Initial Sell Target price is close to $18. If they start to really turn around, he can see the company going far further than $18. They still have lots of difficulties. Management have announced the end of layoffs and are now looking at potentially hiring. That is a major curve in the cycle for him, so he is happy to hold it. When a company like this turns, it can turn fast and can really rocket.