Once again BlackBerry (NASDAQ:BBRY) is going up and down like a roller coaster. In fact, I might be giving the roller coaster a bad name, because I have yet to see a roller coaster do the hoops that BlackBerry's stock has done.
If you have not followed what happened today, the WSJ ran a story on how AT&T (NYSE:T) has given no attention to the launch of the BlackBerry Z10 in its Manhattan stores and that there were very few customers who were interested in the device:
At two AT&T stores in Manhattan, there were neither special signs nor floor displays to promote the Z10. Apple Inc. (NASDAQ:AAPL) on the other hand, still had its own space on the wall prominently displaying three different iPhones in the stores.
When a customer asked to see the Z10 at an AT&T store in downtown San Francisco, the store's representatives had to retrieve it from the back. The device hadn't been put out on display at the store's opening because of difficulties setting it up, a store employee said. The device was eventually installed on a display at a back corner of the store, away from a large sign advertising the iPhone 5.
My question is, is this a reason for today's roller coaster ride the stock did?
Yesterday in Barron's, analyst Jeff Johnston from Detwiler Fenton indicated that "consumer pre-orders have been light and well below expectations."
Now I don't know about you, but I follow this stock very closely and I am unaware of what the pre-order expectations for the Z10 are. I not only have no idea of what the expectations are, but who makes up the expectation numbers to begin with? I mean is there someone out there that actually polls analysts and industry officials and asks what their expectations for Z10 pre-orders are?
Given however that BlackBerry recently received its biggest order in the company's history, one would assume that pre-orders might be doing good.
And just to give you an idea of how crazy expectations and estimates are, on the one hand we have Jeff Johnston from Detwiler Fenton (link above) who expect the company to sell 13-15 million units for FY 2014 , and on the other hand we have Ehud Gelblum from Morgan Stanley, who sees the company selling 36 million devices in the fiscal year that started this month!
So now you tell me, who is the authority in the BlackBerry space that has taken a poll and knows what pre-order expectations for the Z10 are?
Second, which analysts should we believe, when there are such contradicting estimates?
It seems to me that many short-term players in the market are trying to find any reason to short this stock, no matter how solid or reliable the information might or might not be.
I mean when you have solid upgrades from major firms like Goldman Sachs and Morgan Stanley, why would anyone actually take into serious consideration what a tiny firm like Detwiler Fenton says? I am not ranting on the firm or the analyst, everyone has the right to an opinion, but shouldn't investors focus more on what firms like Goldman Sachs and Morgan Stanley say, that have a much bigger market footprint?
As for the WSJ story, I do not doubt that there were not that many people interested in the BlackBerry Z10 on opening day. My question is, is this a reason to think the Z10 will not sell? Also, is this a reason to think that pre-orders (no matter who makes up the numbers) are not up to expectations?
Maybe and maybe not. One thing is for sure, this stock has been a roller coaster and will probably continue to be one for some time. We have seen this before and we have taken the volatility on the chin.
At the end of the day, however, BlackBerry has taken a licking before and has kept on ticking. My advice is ignore the noise for now until we get some solid numbers in several days, when the company reports on its first fiscal 2013 quarter. Because until then, whatever anyone says, their guess is probably as good as mine.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.