BlackBerry's recent history, including a highly publicized new phone introduction, rumors of weak sales and chatter about a possible acquisition remind me an awful lot of Palm's last days as an independent company. That's not a good thing.
Back in 2010, when I was writing about Palm, I actually recommended the company find an acquirer before its value completely dissipated. As you will recall, Palm sold itself to Hewlett-Packard (NYSE:HPQ) and saved its shareholders the little bit of value it had left. Just a couple of weeks ago, I heard on CNBC that there were rumors of Lenovo (OTCPK:LNVGY) having an interest in BlackBerry (NASDAQ:BBRY). That struck a chord with me, and I'll be writing about how I think such a combination might impact BlackBerry, Lenovo and Apple (NASDAQ:AAPL) in my next BlackBerry article.
BlackBerry just made a spectacular introduction of its newest phone, the Z10. Some are openly wondering why the company did not introduce a keyboard version for its core customers at the same time, or even before the board-less version. Perhaps not coincidentally, just before the end at Palm, you will recall that it too introduced a sort of last ditch effort phone. Palm's phone ended up sitting on shelves and on its own inventory when it could not break Apple's hold. Apple has so shaken the industry that Motorola's phone segment ended up at Google (NASDAQ:GOOG), Palm at HP, Nokia (NYSE:NOK) on life support and BlackBerry perhaps taking its last breath this year if history repeats.
Also like Palm, there are rumors about BlackBerry's sales possibly disappointing this quarter, which will be reported first thing Thursday morning. If we get a sales disappointment (earnings may make it on cost reductions), BBRY will likely fall sharply and shed all its gains garnered on its latest new product introduction, just like Palm did. At that point, a sale or merger might also be this company's only way to preserve some value for shareholders.
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.