Will BlackBerry Ltd. Shares Double Again?

BlackBerry Ltd. (TSX:BB)(Nasdaq:BBRY) shares have spiked more than 100% since late 2013, seemingly without anyone noticing. Will it happen again?

| More on:
The Motley Fool

It seems everyone really likes to pick on BlackBerry Ltd. (TSX: BB)(Nasdaq: BBRY). Without looking too hard, you can easily find stories about its inferior product line, collapsing market share, and its depressed stock price.

But lost amid the noise, the company has had some nice successes. In fact, if you had bought the shares in late 2013, at the 52-week low, you would have more than doubled your money by now. So will the shares double again? Obviously, it’s hard to say, especially if you try to predict the time frame, too. But there are reasons to be optimistic, and below are three of them:

1. The right focus

BlackBerry’s fall from market leadership is well documented. And the company’s efforts to regain such prominence didn’t help, either — in fact, they led to Thorsten Heins’ ouster as CEO. But since then, the company has decided to focus more on its core group of customers.

New CEO John Chen put it best in an interview with Fast Company: “This doesn’t mean we are turning our back on the consumer – far from it – but it’s important we narrow our focus on our core strengths … with the strong confidence that we will rebuild BlackBerry for the benefit of all of our constituencies.”

One of them is the emerging markets consumer, especially in countries like Indonesia. The other is, of course, the enterprise customer, which still values BlackBerry’s offering and faces higher switching costs than the average consumer. Meanwhile, the company has outsourced the actual making of phones and has sold most of its real estate. The result is a leaner and meaner corporation, one with better potential to actually make money.

2. The ever-increasing importance of security

When hackers got a hold of nude celebrity photos a few weeks ago, it offered yet another opportunity for BlackBerry to remind everyone about the importance of security. But it wasn’t the only recent high-profile data breach. Just look at what happened to Target earlier this year. And as BlackBerry likes to continually point out, Germany Chancellor Angela Merkel switched to BlackBerry after discovering that the NSA was tapping her phone.

Going forward, security will continue to gain significance. And BlackBerry still has a clear edge here. So this should help the company for a long time, especially with corporate customers.

3. The right leader

Thus far, it appears that Chen has made all the right moves. This should surprise no one; Mr. Chen has a fantastic track record of turning around companies, most notably Sybase. When he took over Sybase in the late 1990s, the company was losing money and headed toward bankruptcy. But he turned that company around successfully, eventually selling it to SAP for US$5.8 billion.

So there are still plenty of headwinds facing BlackBerry. But at this point, most people still love to pick on the company, and that seems to be holding down the share price, providing the rest of us with a great opportunity.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

More on Tech Stocks

Overhead shot of young adults using technology at a table
Tech Stocks

Forget NVIDIA: 1 Tech Stock to Buy Instead

Here’s why Shopify (TSX:SHOP) stock could be a smart long-term buy for investors willing to look beyond NVIDIA’s impressive growth.

Read more »

Lights glow in a cityscape at night.
Tech Stocks

2 Artificial Intelligence Stocks to Buy and Hold for the Next Decade

Qualcomm (NASDAQ:QCOM) and another well-placed AI stock could drive substantial capital gains over the next decade. Here's how.

Read more »

Arrowings ascending on a chalkboard
Tech Stocks

This Small-Cap Stock Is up 20% This Year, and Here’s Why it Can Go Even Higher

Here's why investing in small-cap growth stocks such as Sylogist can help you beat broader market returns over time.

Read more »

Double exposure of a businessman and stairs - Business Success Concept
Tech Stocks

Up 51% This Year: This Canadian AI Stock is Still Down 65% From Its Highs – Time to Buy?

Copperleaf Technologies (TSX:CLPF) stock has shown positive momentum as the AI stock attempts a recovery. Can shares rise 180% to…

Read more »

Person uses a tablet in a blurred warehouse as background
Tech Stocks

This Is the Best AI Stock to Buy Right Now

The problem with buying an AI stock with all the hype in the market is that it becomes difficult to…

Read more »

A microchip in a circuit board powers artificial intelligence.
Tech Stocks

After Nvidia: 4 Artificial Intelligence (AI) Stocks That Look Ready to Split

Nvidia just announced a stock split. Which semiconductor stocks might be next?

Read more »

Hand arranging wood block stacking as step stair with arrow up.
Tech Stocks

Lightspeed Stock Soars 19%: What Investors Need to Know

Lightspeed (TSX:LSPD) stock started climbing once more with higher performance and a promising guidance for the next year.

Read more »

stock research, analyze data
Tech Stocks

Where to Invest $7,000 in May 2024

Do you still have some contribution room available in your TFSA this year? These TSX two stocks should be on…

Read more »