BlackBerry Ltd (NASDAQ:BBRY)
BlackBerry is having yet another strong day in the market today, and for good reason. The company was the subject of a key analyst upgrade that led to investor excitement. Today, we’ll talk about the upgrade, how the stock reacted to the news, and what we can expect to see from BBRY moving forward. So, let’s get right to it…
Raymond James Sees Incredible Upside Potential In BBRY
In a note to investors, an analyst at Raymond James made the decision to upgrade BlackBerry stock today. The analyst, Steven Li upgraded BBRY from a rating of Market Perform to an Outperform rating. At the same time, the analyst decided to increase the price target on the stock from $8.00 per share to $10.50 per share.
The move to upgrade BBRY comes from the liability and balance sheet risk associated with the new hardware offering from the company, DTEK 50. The analyst believes that there’s really no downside revolving around this offering. At the end of the day, if it works, BlackBerry has a great product that make a profit from. If the product doesn’t work well, the company reverts back to software, which would also be positive. In his release, Analyst Steven Li had the following to say…
“[Best case], DTEK shows there is a market for a secured version of Android… Now, think of the potential of licensing a “secured version” to Android manufacturers and have their device enterprise ready…”
He went on to explain that in the worst case scenario, the DTEK 50 flops. From there, the company moves to focus wholeheartedly on software. Steven Li believes that this would be positive because the company is already moving in the right direction with regard to software.
How The Market Reacted To The News
One of the first things that we learn as investors is that the news tends to move the market. The news that was released surrounding BBRY today was overwhelmingly positive. So, it only makes sense that we saw a positive reaction in the market today. By the end of the trading session, the stock closed the day at $8.08 per share after a gain of $0.20 per share or 2.54%.
What We Can Expect To See Moving Forward
Moving forward, I have an overwhelmingly bullish opinion of what we can expect to see from BlackBerry. At the end of the day, I’ve maintained opinion for some time now. When BBRY released the Priv, I was overwhelmingly impressed by the move. After all, we’re talking about the company that was the driving source of innovation in the smartphone arena.
The new DTEK 50 is a great opportunity. The low price on the phone makes it a great enterprise offer. However, we know that anything can happen here. While I don’t think that the phone will flop, there’s no guarantee that it won’t. Nonetheless, even if it does, the company is making big waves in the software arena, and a stronger focus there can only improve the outlook. All in all, I think Steven Li hit the nail on the head and that we can expect to see gains in BBRY moving forward.