As far as Canadian technology companies go, BlackBerry Ltd. (TSX:BB)(NYSE:BB) has been a laggard in recent years. The company has been without a significant growth catalyst to take it back to its growth days of the past. The good news is, now there’s a catalyst to be excited about. Even better news: this catalyst happens to be a partnership with Amazon.com, Inc. (NASDAQ:AMZN)!
Amazon will make BlackBerry great again
Amazon is a company that is built on disruption. When Amazon moves into a sector it targets, it takes no prisoners. This is certainly good news for BlackBerry, a company that has partnered with Amazon to develop software for connected vehicles.
The software BlackBerry is developing to enhance the analytics and big data needs of the future could be game-changing. The company’s Intelligent Vehicle Data Platform (IVY) provides for improved data collection from vehicle sensors. Accordingly, big data possibilities that did not exist tomorrow in improving the performance of next-generation vehicles now exist. The potential benefits of this technology are incredible, and I think BlackBerry and Amazon are positioned well to take this market by storm.
BlackBerry’s been working on its QNX and IVY platforms for some time. Indeed, this partnership with Amazon provides confirmation of the quality and niche the company’s products serve.
Keep an eye on those quarterly earnings
BlackBerry’s stock is potentially only in the early stages of a parabolic move. Should BlackBerry report some pretty fantastic numbers in the upcoming quarters, investors may once again get that itch to buy shares in this great Canadian technology company. I think the recent settlement BlackBerry reached over its patent-related disputes could help these numbers along greatly. Additionally, any sort of growth upside that arises out of this Amazon deal will be greeted warmly by the market.
Whether or not BlackBerry reports insane numbers this year remains to be seen. Indeed, this partnership could take a while to get off the ground. That said, I think Amazon is a company that is intent on creating impressive growth in this business. This partnership could be influential right away, and the market is pricing in these expectations right now. Amazon is the five-hundred pound gorilla that can turn this niche software from a small Canadian tech company to the next level.
My expectation is that BlackBerry’s quarterly numbers will greatly exceed analyst expectations this year. I think this is an under-valued software player in a sector that has a number of secular drivers that could take BlackBerry’s stock on a parabolic ride. Time will tell, and execution risks exist, but Amazon’s validation of this platform is worth its weight in gold right now.
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.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Fool contributor Chris MacDonald has no position in any of the stocks mentioned. David Gardner owns shares of Amazon. The Motley Fool owns shares of and recommends Amazon. The Motley Fool recommends BlackBerry and BlackBerry and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon.