BlackBerry (BB.TO)

Thinks at some point they may be able to grow their revenue. John Chen did very well in the past at Sybase. There was a turnaround there and a take out. The bigger the boat is, the longer it takes to turn. He is happy holding this, but is not looking for anything happening quickly.

In the last couple of years, they have had new management, a shifting of focus and new products. Product has been somewhat lacklustre. Their phones are decent, but they haven’t had huge upticks. It is hard to compete with others. The issue right now is their transition to software focus, but that will take time. The good thing about this company right now is that they have a lot of cash. This will be more of a trading stock between now and the next little while.

This makes his list because it doesn’t have excess of debt, but it ranks in the bottom half of all the companies that he looks at. It wouldn’t be on his list of companies that he would be buying. There is no dividend. They seem to be really working hard to surface the value of the company.

John Chen is doing a good job of turning the business around. The hardware business continues to be very, very challenged, and it is a lousy business to be in. It’s a software game now and they seem to be making some good progress. Their security features are very attractive. The question is can Chen make something out of this. It is still very early days in a very challenged environment. He thinks the stock is worth not much more than $15. If there is some takeover speculation and the stock gains in strength, don’t believe it, but take your money and move on.

He still likes the company. You get to the point where you want to say ‘can we move it along a bit’ and so far we haven’t. His patience is getting a little thin, but he is hanging in. It would be nice to see this thing in action.

The little break in the upward trend caused a little concern, but he still likes it. Took a small amount, but then realized he was too early. It is in a sector that should do well.

He likes this longer-term and thinks it gets taken out in the next couple of years. Loves what John Chen is doing. Likes the morphing over to the software. There is a lot of value in those assets in the company. However, he has taken a little bit of money off the table in the short term as he thinks devices are really going to disappoint in the next round of device sales. He would buy back under $12.

(Market Call Minute.) Continuing to struggle. Most recent quarter was positive because of expense reductions.

Thinks they are making some progress in transforming the company, but their problem is that they have a tiny market share in the phone business. They are up against really, really tough competitors. This is now more of a play on what is their intellectual property position worth in a liquidation scenario.

Mr. Chen and his management team are continuing to append their security model. One understands now that it is not going to be a hardware challenge to Apple, android, etc. This is going to take time. Numbers have been getting better.

He likes this company. Thinks John Chen has been doing what he said he was going to do. He cut costs and is profitable. The next goal over the next year is to increase revenues. He is happy to Hold the stock. It is certainly not out of the woods. They have a lot of money in the bank as well as the backing of Fairfax Financial.

It is almost like it is an asset value play at this stage and probably worth $14-$17. CEO has done a great job and got it from $6-$12, but he doesn’t think there is an amazing amount left. It is hard to value and it is hard to look at the earnings to find value.

In the past, he has Shorted this, but more as a temporary Short. When he looks at a name like this, he is happy to be on the sidelines. The industry is changing so fast.

(Market Call Minute.) Transitioning from hardware to software, but it is taking a long time. The service revenues they are getting from their older devices are actually much higher versus the newer ones. They are not expected to make money for a few years.

(Owns a very small amount of this, but at clients’ direction.) He has great difficulty analysing their future prospects. Right now, they have done a lot better than a lot of people have thought. They seem to be surviving, but it is a tough environment. If you invest in this, you are not going to get much of a dividend. It could languish in this particular zone for a long time.