Canadian tech stocks had a good time in the limelight during the tech boom a few years ago, right around the pandemic. The sector-wide meltdown led to many people stepping away from the tech sector to avoid unnecessary capital risk. However, many Canadian investors saw multi-fold returns through stocks like Shopify.
While that is the name that typically pops up when people think of Canadian tech stocks, there’s another that’s been around for longer and might be making some big moves. Most younger people might not know of it right now, but BlackBerry (TSX:BB) was a big name back in the day.
This was the biggest name in the phone industry back when I was in high school. While the company’s smartphone business faded into obscurity a while ago, BlackBerry isn’t down and out. Instead, it has become one of the foremost companies providing secure communications and tech for autonomous vehicles.
Today, we will take another look at this long-forgotten smartphone company to see why it might be a good investment right now.
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BlackBerry
As things stand now, BlackBerry is a Canadian tech company that engages in providing intelligent security software and services to governments and enterprises. The $3 billion market-cap firm headquartered in Waterloo leverages machine learning and artificial intelligence to deliver cybersecurity, safety, and data privacy solutions. It also offers solutions for endpoint security and management, encryption, and embedded systems.
It is no longer the company that fizzled out when other smartphone manufacturers out-innovated it. The company has taken the opportunity to provide the power under the hood of smartphones instead of making the devices itself.
While not as exciting as competing to create the best phones, the company’s business is doing well. The first quarter of fiscal 2026 saw the company report $121.7 million in revenue, beating guidance. The company’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) also beat analyst expectations, coming in at $16.4 million.
Why it’s underperforming
Despite posting good numbers, the company’s share prices have been weak for several weeks. As of this writing, BlackBerry stock trades for $5.03 per share, down by 43.23% from its 52-week high, and a far cry 97% from its 2007 all-time high valuation. Despite the business being in better shape than it has been for many years, the company is struggling against the effects of the tech sell-off. Investors have also lost faith in the company due to its past failures.
Long-term investors who have stuck with BlackBerry stock know that the share prices do not reflect its inherent value. Despite a clean balance sheet, exposure to high-growth market segments, and consistent profitability, investor fatigue has kept its share prices down.
Foolish takeaway
The business is doing well. The recent quarter saw the company end with $381.9 million in total cash and investments, a big improvement from $235.7 million in debt. The extra cash compared to its debt allowed BlackBerry to buy back 2.6 million shares. Despite share buybacks indicating that the company believes its stock is undervalued, it isn’t a risk-free investment. The tech space is constantly changing, and BlackBerry must make sure it stays relevant. All things considered, BlackBerry stock might not be an obvious winning pick, but it is not a lost cause. The company’s margins are improving, and it is profitable. It can be a good contrarian pick to consider for your self-directed portfolio if you can stomach the risk.
