MENU

Why I’m Finally Buying BlackBerry Ltd.

I’ve had a long-standing love/hate relationship over the years with BlackBerry Ltd. (TSX:BB)(NASDAQ:BBRY). I can proudly proclaim that I’ve been an avid user of the company’s smartphones for well over six years, only recently surrendering my BB10 device for an Android offering from a competitor.

Throughout those years of being a BlackBerry enthusiast, I’ve often thought about investing in the company, but I never ventured forward with the purchase. Whatever device from BlackBerry I was sporting at that time was a big part of the reason that held me back.

There was always something missing from the device I was using. Whether it was a touchscreen, a better screen, improved camera, or even a faster processor, it seemed that the bar for BlackBerry devices was set to “good enough.”

Thankfully, BlackBerry no longer makes hardware; its partners have turned around some fairly decent hardware devices that have earned favourable reviews.

What has made me change my mind about BlackBerry as an investment? I put it down to the following four reasons, none of which have to do with hardware.

BlackBerry Radar: the IoT play

IoT, or Internet of Things, is the idea of having everyday devices connected to the web and to each other, feeding information, updates, and diagnostics. The possibilities and use cases are nearly endless, but one simple device that BlackBerry recently brought to market has the potential to provide significant growth to the company over the next few years.

BlackBerry Radar is a product that targets the trucking industry; it allows companies to see real-time information about the location and movement of fleets as well as a number of sensor-specific inputs from humidity and temperature variations to when the doors last opened.

The solution is dependent on a small box: the radar unit that is affixed to the truck which provides the requisite telematics.

The best part of this product is that it provides a solution to a common concern in the trucking industry and a steady stream of revenue to BlackBerry thanks to a monthly service fee for using the service.

Industry experts peg that the growing demand could see BlackBerry bring in half a billion in revenue over the next few years.

Connected cars thanks to QNX

QNX may be known as the underlying operating system behind BlackBerry’s ill-fated BB10 operating system, but few people realize that QNX also powers an array of systems from nuclear power plants and medical devices to infotainment systems in vehicles.

In fact, BlackBerry’s QNX system is already in over 60 million vehicles worldwide, and the company is aggressively working to establish partnerships with automotive manufacturers to further integrate QNX’s advanced capabilities into additional automotive systems. Over 40 automakers rely on BlackBerry’s QNX system, which has nearly 50% of the global market. The closest competitor to QNX has nearly 20% share.

BlackBerry is one of several companies that is actively working on a self-driving car, which will have QNX at its core. BlackBerry has stated multiple times that its goal in the self-driving-car space is to become the operating system of choice for automotive manufacturers. Thanks to the speed and security of QNX, BlackBerry has a lead over the competition, which represents a major long-term opportunity for investors.

The increasing need for cybersecurity, and the software-first view

BlackBerry has always been primarily a software company, despite its previous ventures into manufacturing devices.

BlackBerry is also known and respected for its expertise in adhering to and maintaining security of communications and systems around the globe. Despite that popularity, the company never really took advantage of that fame. It provided cybersecurity services to clients, even its own enterprise customers.

That changed with the acquisition of a U.K.-based cybersecurity firm last year which offers a wide variety of security services and reviews.

BlackBerry’s renewed focus on software is another area that continues to impress me. During the BB10 era, some of the focus on the enterprise segment was lost; as a result, revenues from that segment dropped, and the company as a whole suffered.

In short, that focus is back, and BlackBerry’s enterprise business continues to report gains with each passing quarter — many of which are recurring revenue streams.

Is BlackBerry a good investment?

BlackBerry continues to invest in a number of emerging technologies and areas that will provide it with significant growth and revenue opportunities over the next few years. This not only makes BlackBerry a much-improved investment over what it was just a few short years ago, but it lays the groundwork for a decade or more of growth for investors.

36-Year Old CEO Bets Over $300 Million on 1 Stock

Iain Butler, Lead Adviser of Stock Advisor Canada, recommended this little tech darling to thousands of loyal members last March... and those that followed his advice are up 127.7% (they've already made 2X their money!).

Not to mention this tiny Eastern Ontario company has already been recommended by both Motley Fool co-founders, David and Tom Gardner, because of its amazing similarity to an "early stage" Amazon.

Find out why Tom Gardner was recently on BNN's Money Talk raving about this company, and how you can read all about it inside Stock Advisor Canada. Click here to unlock all the details about his Canadian rule breaker!

 

Fool contributor Demetris Afxentiou has no position in any stocks mentioned.

I consent to receiving information from The Motley Fool via email, direct mail, and occasional special offer phone calls. I understand I can unsubscribe from these updates at any time. Please read the Privacy Statement and Terms of Service for more information.