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There Has Never Been A Better Time To Invest In BlackBerry But I'll Pass

May 06, 2021 11:26 AM ETBlackBerry Limited (BB), BB:CA327 Comments


  • BlackBerry has made steady progress in positioning itself as a software company.
  • The company is gaining market share in 2 markets that are projected to grow exponentially in the coming years.
  • Although I believe there has never been a better time to invest in BlackBerry, I have decided to remain on the sidelines for reasons discussed in this article.
  • I do much more than just articles at Leads From Gurus: Members get access to model portfolios, regular updates, a chat room, and more. Learn More »

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Photo by MF3d/E+ via Getty Images

For a company to transform itself from a smartphone manufacturer to a profitable software company, it truly takes a lot. BlackBerry Limited (NYSE:BB) is on the cusp of achieving this incredible feat, and

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This article was written by

Dilantha De Silva profile picture
I am Dilantha De Silva, an investment analyst with 8+ years in the investment management industry. Before becoming an independent publisher, I worked as a buy-side analyst in a leading boutique wealth management firm in Dubai where I dedicated my time to identifying U.S. small-cap stocks for the funds managed by the firm. I am the founder of Beat Billions, a premium Investing Group on Seeking Alpha focused on identifying alpha-generating thinly followed stocks in the market. I am a CFA Level III candidate and an Associate Member of the Chartered Institute for Securities and Investment (UK).

Analyst’s Disclosure: I/we 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.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (327)

BillySnake profile picture
I’m back in with a modest thousand. It’s a $100.00 stock mark my words. And it will give conniptions to a few aging critics of BB here.

🚀 to the 🌙

Sounds like ford is moving to Google car OS with apps and all those goodies.
Racer-X profile picture
BB is 2nd most talked about on WSB on Friday, May 28th:


You have this article titled "Never been a better time to buy BB" but too scared to jump in. Juxtaposed on a nihilist mob at WSB. It sounds like a potent concoction of bear porridge, if you ask me.

Look at the mindset coming your way next week. At least, this is a glimpse into that mindset by examining a few good quotes from our WSB friends:

1. The positive side of bb is at its current prize it is a good buy regardless of the squeeze situation.

2. You beautiful beautiful ape

3. Wow, diamond hand strong actually paying off, well, I’m at an $18 average, but we taking off!

4. You have inspired me. I just added another 145 shares. Its not much but I am a baby ape.

5. BB rocket ready to go to mars🚀🚀🚀🚀🚀🚀

6. load up 1500share eod friday 🚀🚀🚀

7. God soldiers follow orders... time to buy more BB

8. Reporting for duty with my 80 shares

9. Made $1k on amc and dropped it into BB cuz I’m retarded. Is this what the moon feels like?

10. Anything under $140 is a dip

Multiplied by thousands! Believe me, bears, when I say from the bottom of my heart that I'm LOLing at your situation. No sympathy here. However, I will show you a way out. Transformation. I suggest watching The Wizard of Oz this weekend. Take notes. Where did the lion get his courage? Where did the tin man get his heart? Where did the scarecrow get his brain?

Well, I have my popcorn! Any strategy you quiet bears want to share before the stampede arrives Tuesday morning? :) Any regrets on anything you said 365 days ago on the record when declining BB at $4? Any last words? :)
Racer-X profile picture
@Racer-X A little retrospect from an article today (the day after):


Some Excerpts:

1. As BlackBerry's stock price jumped, so did the number of mentions of it on Reddit, according to HypeEquity data. The mentions were frequently accompanied by rocket ship emojis, which indicate a retail trader's sentiment that the stock price will "go to the moon."


2. On Wall Street Bets, the Reddit thread that has ballooned to more than 10 million members following the GameStop craze earlier this year...

@Racer-X What you are tagging as progress for the company, which if true has made you money as the stock goes up, is instead trading momentum which could happen to any company that the WSB crowd chooses. That apparently works well, so fine, but it could be any losing, doomed company like Boston Market or Quizno's or your local, family-owned pharmacy. Choosing them to make your statement to the hedgies does not suddenly make the company a significant winner, even if the stock price goes up for a time. I made the money in Gamestop going DOWN, that works well too.
@csskwtn2020 (from above article ...”After noticing that QNX described Apple as a “strategic partner,” N4BB put together the theory that the Car Play software in cars was essentially running on top of QNX, and reached out to the company to confirm. The response from QNX was in the affirmative, with the company saying, “we have a long-standing partnership with Apple to ensure high-quality connectivity with their devices, and this partnership extends to support for Apple CarPlay.”

“That’s just delicately worded enough to keep us from saying with authority that all CarPlay implementations everywhere will run on QNX, but it does make clear that QNX is a significant part of CarPlay, and that on its own is pretty fascinating in our book.”
GreenEggs&Ham profile picture
@csskwtn2020 a few takeaways from that article

Most cars use an infotainment operating system based on Linux, BlackBerry’s QNX, or Google’s Android Automotive to run a screen embedded into the car’s dashboard. The infotainment systems often have their own music or maps software, and car companies sell wireless subscriptions and other upgraded features for them.

CarPlay runs on top of those infotainment operating systems and allows iPhone owners to access their most important apps while driving in a way that’s safer than looking at their phone.

" CarPlay doesn’t contribute direct Apple revenues or profits. But it ensures ongoing loyalty of iPhone users and gives Apple a pathway into the auto industry if it wants to expand."

But CarPlay in itself is not a moneymaker. Currently, CarPlay is free in most new vehicles, from basic models all the way up to luxury SUVs. BMW used to charge users a monthly fee to access CarPlay, but stopped in 2019 after customers complained.

Apple says doesn’t charge automakers to use the software. It’s not a licensing business."

In other words this article has literally no affect on BB much less anything
Denis III profile picture
Denis III profile picture
@Denis III Come on, paper hands. I need to pay the fridge, eh @Racer-X ?
Racer-X profile picture
@Denis III My diamond hands are beaming! :) Accounting for my negative $1.50 cost basis, this is pure $11.57 PROFIT so far. 100%+ profit. And I'm not paying taxes on it because of my DIAMOND HANDS. LOL

Cha Chen! I'm thinking more in terms of driverless cars and IVY. Not fridges. Thinking big, not small. And reaping what I've sown.

Which brings me to the question I can't ever seem to get answered around here. What was the reason given at bear headquarters for passing on $4.00 again? Wet paper hands influence, perhaps? :) Good at grasping at straws but unable to swing at good pitches? Or just can't hit a ball? Or, blind? Strike out phobia? I know there is a rational explanation. I just don't know what it is yet.
Denis III profile picture
@Racer-X I've explained many times & so I'm done repeating myself. You should take my advice.
Elicc profile picture
A beautiful day and week with up and down.
RBC target was touched
Canacord target was touched
Denis III profile picture
@Elicc Denis's target was touched and passed , for now. It's a 4$ stock but I will accept 8.
Racer-X profile picture
@Denis III That's just admission that Mr. Market is your guide. As I said...
Elicc profile picture
@Denis III That's right BB make happy everyone but you put to much drama and you don't win credit.
Denis III profile picture
40% up in 48 hrs and y'all don't take it?
Denis III profile picture
Shorted 2000 @ 9.95. Here we go again.
GreenEggs&Ham profile picture
@Denis III Thats a money maker
Denis III profile picture
@GreenEggs&Ham For the fridge, stove & dishwasher already paid with bb profits off odd longs like Racer.
KIA Investment Research profile picture
@Denis III Good luck!
$AMC is another WSB darling that's been on fire the last couple days.
It's a new world out there, lol.
Racer-X profile picture
Did bears turn to crickets? Sure sounds like it....

Don't feel so sad, bears. Think of it this way. The universe will end one day and your lives will have meant nothing! That's reason to celebrate. Right? Somewhere, there's somebody suffering more than you guys. So, be happy! There is misery to be found! And Bill's bashing? Well, it wasn't all for nothing. I mean, it was like a twinkie diet in a way. It must have felt delicious and nutritious at the time. Right? You enjoyed it, I'm sure. Paying for that twinkie diet now, but it's not like you weren't warned.

Do you need money on loan? Would that cheer you guys up? I offer hard money loans at 26% interest. That means you need collaterol, of course. Obviously, as we can see your words mean dirt. No offense. No credit for you! And don't expect any fringe benefits like the American Express blue cards. You don't earn any points with me. But, I could at least put some money into your pockets. :)
GreenEggs&Ham profile picture
@Racer-X When the WSB magic subsides the bears will profit.....as usual.
Energysystems profile picture
@Racer-X ..."That means you need collaterol, of course."

Obviously, as we can see your words mean dirt.
No offense.
Twinkie—reminds “Twinkie Defense”.
Short interest up again. Now over 50M and stands at 9%. Few months ago we were at 19M. Also Institutional Interest % down as well.
Racer-X profile picture
Assume the position, bears:


I know many of you are very used to it by now. But for you newbie bears: Be afraid. Be VERY afraid!
Denis III profile picture
@Racer-X You see this is full on ret*r*e*d as they even call each and this ridiculous fluff piece believing it's news, says BB is telecom lol. Complete incomprehension of BB as it is.
Racer-X profile picture
@Denis III Weak long was the wrong way to go. They are talking us up at WSB again. I found this over there. Interesting. Looks like you and Kia are on the wrong side of the trade again.


Longs, however, hold the loaded dice. We have the aces up our sleeves. Doesn't matter how the cards fall. Win, win. Sorry you missed the boat again, but that's life when you can't understand value. You called zero, and that was just beyond fear and folly. That is a category best left unsaid I guess.

I hope as a boxer you fought with heart and mind. Because as an investor, I'm seeing neither. Just flaky, no direction, no understanding of value, and too emotionally tied to falsehoods. It's okay to have emotions. As a boxer, you should probably know that. You just need know how to harness them. And harnessing them towards folly is a fool's game.
Elicc profile picture
@Racer-X I put this increase rather on Ford's $ 30 billion news than on Redditors. WSB, it's a created illusion. Maybe if the whole industry will put money like Ford in EV then BB will be able to materialize very well their patents or maybe it will fall into the arms of a stronger investor than Watsa to support the new demand.
Elicc profile picture
OMG, what do we celebrate?
@Elicc pity of WSB and lack of Chen's value creation for its shareholders.
Elicc profile picture
@Zumant Honestly, I don't think the WSB really ever existed. I took them more as an instrument of a big guy ... someone like Watsa.
These days it is more than obvious that the move was created to cover the Primecap, OTP and Allianz transaction. A manipulation.
Denis III profile picture
@Elicc I so want to short BB, it hurts.
Racer-X profile picture
They did again. 10 hours ago:


They just won't stop. Truth always comes out of the shakes. Some excerpts which I long ago noticed on the written record:

1. CEO John Chen is brilliant, but not even he can turn a ship around overnight. I’ve said it before, and I’ll say it again: BlackBerry stock begs for investor patience, and only those investors who are willing to suffer through immense pain will be the ones that will ultimately make the most money from BlackBerry’s turnaround.

ME: Well, yes and no. When you have a negative cost basis of $1.50 (to repeat NEGATIVE cost of $1.50), there is no patience needed really. It's like a steady march forward in profits regardless... It's like being paid to wait. Plus, great virtual documentary in the making. Like living the case study that will be in future textbooks, but without the benefit of hindsight. Just much more exciting this way. And PAID handsomely int he process.

2. After plunging back to $10 and change, BlackBerry is a deep-value stock, plain and simple

ME Of course! Very obvious to anyone who is a guide unto himself as opposed to giving that job to Mr. Market.
3. Fairfax Financial top boss Prem Watsa, a man we know as Canada’s Warren Buffett, remains bullish on BlackBerry shares. As one of the most patient investors on the planet, in due time, he’ll likely be proven right in standing by the firm.

ME: That was always pretty much a given. Often repeated on the time-stamped record here. But, quashed by the tour guide to some. Because they lack patience!

4. Nobody knows when he might be proven right, but shareholders will be in some pretty good company as John Chen looks to take BlackBerry’s transformation to the next level.

ME As I've often said. Not matter of IFF, only when. I don't how many different ways I've said it. In so many formats. Like a MINIMUM hold is 5 years. It's been only, what? 6 years? Is 5 less than 6? Does minimum equal maximum?

5. Despite the 67% WSB implosion, the stock is still up nearly 60% over this past year.

ME: Well, that's what they keep saying like the article we are typing on. Best time to buy, but I'm too afraid to touch it is generally the jist. So, they miss these great gains while at the same time saying BB longs are suffering. But I'm not suffering. I have a negative $1.50 cost basis. And I expect it to go negative $5 when my puts expire worthless IFFF given another great value opportunity. It's easy money!
Racer-X profile picture
@Racer-X Interesting video made on May 21, 2021 on Blackberry's Stock


A bull argument from "Equity.Guru". Nothing learned, but nice to see this kind of sentiment. It's good to have fresh, uncorrupted minds in the labor force out there to choose from. I say, fire our current shareholders and let's get some new faces with some good attitudes!
I thought Zero Trust was a real advantage BB had. Their Zero trust is like THE ZERO trust. Looks like Ernst & Young think CRWD is better EVEN if BB secures 90% of G govts and military.


On the same note, was watching Monaco F1 and got nice CRWD commercials after the race.
Elicc profile picture
@Zumant It's a big win for CRWD. BB has his bobo but it's write "...as one of..."

"CrowdStrike Falcon has been selected as one of the EY preferred cybersecurity technology platforms"...
... they could only be chosen for America and I think this is a normal business for America now.
see that "One or more member firms ..."
"One or more member firms of Ernst & Young Global Limited participate in alliances with the following companies:" www.ey.com/...
sfinvestor profile picture

BB has been eaten alive by Crowdstrike for 3 years and counting. You don;t need EY to tell you customers choose Falcon, the numbers do. One grew ARR by about 1B while Cylance shrunk.
@Elicc checked that list and dont see BB or Cylance.
So Audi moves away from QNX
Now they are testing their own V2X system?
Racer-X profile picture
@Zumant I think that was a too broad of a sweeping interpretation on your part, Zumant. First, in a different article, I think Audi was moving away from QNX in infotainment only, which is a trend as discussed by Blackberry. Like the case with Ford, yet Ford remains a Blackberry customer on so many other fronts.

Then your link doesn't discuss anything about QNX at all. And a search for anything related to QNX and Audi this month in regard to anything but infotainment can't be found. So, I don't think you understand, nor has Audi testified so I wouldn't put words in their mouth.

On the other hand, at about the same time as your article is dated, Volkswagon chooses Blackberry "to power its W6 all-electric SUV":


And who owns Audi? Volkswagen. So, until Audi takes the stand and can be cross-examined, we need to keep such fact testimony in its proper category -- speculation according to layman witnes. If you don't mind, please. And, no, we don't need our Korean car fan take the stand here. We already how he's going to testify. We want good research, like Frost & Sullivan or a myriad of good, qualified experts to be called as expert witnesses. And those most close to the situation -- inside Audi preferred.
@Racer-X really W6 is Volkswagen :) . Thats far fetched. Maybe in some alternate reality. Try again.

meanwhile have you seen the latest Gartner EPP report. BBs dropped to the bottom of the pack. Even Bitdefender is better.
@Zumant :

I wanted to make sure I dug deeper into all possible layers within the article you linked and cannot find ANY mention of QNX or loss of business. Some key points that I believe you are missing.

1/ The standards for V2X are still being hammered out within the US and the EU (802.11 vs 3GPP) en.wikipedia.org/... Blackberry's involvement has been mostly at the encryption level and compliance, and NOT on the OS or QNX level. blackberry.certicom.com/...

2/ What also runs counter to your position is Volkswagen Group (which includes Audi) a recent signing to future IP licencing moving forward for EV-AV platforms with Avanci. www.avanci.com/... As you know Avanci has an agreement with $BB to licence the appropriate patents given to them thru a third party arrangement.
Racer-X profile picture
THEY DID AGAIN. Fresh off the printing press:


Another bull article. This time not even Motley. Time and time again. I imagine the cognitive dissonance bears face lately must be really crippling to those who feel it's more important to be not wrong than it to be right. And I do have some good corporate articles from the field of psychology on how to reduce that with some smart thereapy. But you have to WANT to change. Just let me know and I'll get you some help.

Meanwhile, let's look at some excerpots without Bill and gang's usual cherry picking. You know, the OBVIOUS:

1. When I checked BlackBerry stock’s capital appreciation, it has surged 63% in the last 12 months. In dollar terms, if you had invested $1,000 in BlackBerry in May 2020, you would now have over $1,600 in your account. This growth excludes the bump Redditors created in the stock price graph in January. This 63% surge is also not due to the pandemic or because of strong fundamentals.

MY COMMENTARY: OHHHHH, YOU DON'T SAY?? That's for those that just parked and could actually sit still. My profits at a negative cost basis of NEGATIVE $1.50 means you actually have to add $1.50 to the stock price to know what my profit is. But I don't want to confuse bears anymore than they already are.

2. BlackBerry has a strong products roadmap that is gaining traction. It has the potential to compete and once again makes its mark. But it will take three to five years to become the next Advanced Micro Devices.

MY COMMENTARY: Yep. Not a matter of ifff, only when. It's called loaded dice, really. Chen, Prem and company constantly tweaking against the natural laws of chance. Notice the 180 degree turn? That didn't happen by itself. Which leads me to another question: Where are all the BEAR articles? Motley has about 3 in 10, which is a trend probably approaching 1 in 10 like a flouride commercial. But the others? Crickets!!! I mean, Kia Research did pull up a very bullish link from BB itself, claiming it was a bear case. Yet, clearly wasn't. I guess the pickings must be slim.... Talk about -- well that would be a textbook example of COGNITIVE DISSONANCE.

It's like global warming deniers. Do they even notice that EVERY energy company is making the transition, virtually? What can smack you into reality? Which, again, brings me back to some good corporate research. Free, but somebody paid a lot. When you are ready to get help, let me know, and I'll give you some good links on how to cope with your cognitive dissonance. Green Eggs? Changing monikers isn't one of them. Just FYI.
GreenEggs&Ham profile picture
BB will be looking to display strength as it nears its next earnings release. In that report, analysts expect BB to post earnings of -$0.06 per share. This would mark a year-over-year decline of 400%.

For the full year, our Zacks Consensus Estimates are projecting earnings of -$0.09 per share and revenue of $807 million, which would represent changes of -150% and -12.19%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for BB. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. BB is holding a Zacks Rank of #4 (Sell) right now.
@GreenEggs&Ham :

THX. Here is the link from Zack’s 7 days ago www.zacks.com/... at $7.94 or +7.5% on a very tough week for tech.
Elicc profile picture
@GreenEggs&Ham I'd like to take Zacks as a referance but it faill to impress me. More than that I do the opposite usually. I do not contest that BB could go lower from this level or to go up but where was Zacks when all the people from this planet saw the fall of BB SP from $28.77? Why it was bull all this falling way of BB SP from the sky... and why it is bear when BB SP is already down? That's my question.
PS I assume it is the game of outgoing institutions that are now set in BB accumulation mode.
Elicc profile picture
7 Signs That You Have an Ego Problem
may be help
All I can say everything is relative. Comparing BB valuation to her peers BB is greatly undervalued. another question is why the market is so brutal to BB. An answer is also simple: big BB players do not want to let it go for whatever reasons. It can be CD shorting against the box, it can be other games. But definitely BB business progress and development has nothing in common with share price valuation. Go to many stocks that makes no money today and in a distant future while valued much higher.
Today I was looking at nasdaq filings and saw that BB now has only 40% institutional ownership. I found it strange since Allianz added 27M. So without Allianz we would be in 30% Institutional ownership. Insane

Guess watsa WATSA SOLD a huge chunk.
PRIMECAP MANAGEMENT CO/CA/ 03/31/2021 44,046,890 -15,307,102 -25.79%
---------------------------------- 15M SOLD

ARROWSTREET CAPITAL, LIMITED PARTNERSHIP 03/31/2021 12,600 -8,472,179 -99.851%
----------------------------------8.5M SOLD

WELLS FARGO & COMPANY/MN 03/31/2021 44,236 -7,379,800 -99.404%
---------------------------------- 7.3M SOLD

MARATHON ASSET MANAGEMENT LLP 03/31/2021 0 -3,816,972 Sold Out
---------------------------------- 3.8M SOLD

STALEY CAPITAL ADVISERS INC 03/31/2021 0 -2,276,541 Sold Out
---------------------------------- 2.2M SOLD

KAHN BROTHERS GROUP INC /DE/ 03/31/2021 2,669,291 -2,060,975 -43.57% $22,529
---------------------------------- 2M SOLD

BECK MACK & OLIVER LLC 03/31/2021 1,180,963 -1,897,900 -61.643% $9,967
---------------------------------- 1.9M SOLD

PRIVATE MANAGEMENT GROUP INC 03/31/2021 13,806 -1,759,033 -99.221% $117
---------------------------------- 1.7M SOLD

DIMENSIONAL FUND ADVISORS LP 03/31/2021 2,698,400 -1,734,041 -39.122% $22,774
----------------------------------- 1.7M SOLD

HILLSDALE INVESTMENT MANAGEMENT INC. 03/31/2021 0 -1,137,200 Sold Out
------------------------------------ 1.1M SOLD

CITIGROUP INC 03/31/2021 387,890 -768,883 -66.468% $3,274

-------------------------------------- 0.7M SOLD
@Zumant So primecap used to have 71M shares in 2020. Then in 2/2021 filing, they trimmed it to 60M. Now 44M. Looks like they are timing their exit with Chens 2023 exit. Strange when turn around is complete and shares are going to the MOON in the next few years. Maybe Primecap hates money. IF 10 years of Chens leadership ends up with 0 gains for the public / retail shareholders it will be the biggest con of CA.
Racer-X profile picture
@Zumant All of that data is corrupted. It's meaningless in the context of a price hike. The real takeaway is that they made investments that paid off massively and now have a negative cost basis like me on what they have left. Probably jumping back in now. But prudent men would never exit completely. As noted in the data.

Just have to know what the data means. It doesn't speak for itself. Data can only be interpreted through the light of theory.

Meanwhile, where were bears? Same place as now. Off he boat and talking vacuously 24/7. Boat left dock at $4, and they are still barking up the same ole tree.
Zack 800 profile picture
@Zumant do you think some may have took advantage of the huge SP price increase of $28 in January?Can you really blame them? I guess another question could be 'why didn't they sell their whole position?'
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