As a TSX stock that once soared above $250, Blackberry Ltd. (TSX: BB) has been through it all. The rise, the fall, and the in-between stagnant period of going nowhere. But through it all, there’s one thing that Blackberry has always maintained – technological excellence.
Today, Blackberry is a TSX stock that’s gaining traction and momentum in both its business and its stock price. Here’s why this undervalued TSX stock is a great long-term buy.
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Blackberry: What happened to this TSX stock?
First, a brief look at Blackberry’s history. Blackberry was once the undeniable leader in handheld phones. As you know, this is no longer the case, as Smartphones such as the iPhone and Android began to dominate the market in the early 2010’s. By 2016, the “Blackberry” phone was pretty much history.
At that time, the company had to do something drastic to survive. It was a touch and go situation until finally, Blackberry opted to change course and embark on a transformation. Its areas of choice were the Internet of Thing (IoT) and cybersecurity industries. Both drew on Blackberry’s expertise and as this undervalued TSX stock strengthened its presence and focus on these areas, this expertise grew. The company’s reputation now proceeds it.
As one would expect in such a situation, Blackberry’s stock price fell hard. In fact, it traded below $10 and stayed in this range for many years. The stock is currently trading at approximately $12.40. This is 46% lower than 2022 levels and way below its historic highs.
Blackberry and the connected car
For years, this undervalued TSX stock has been quietly working to establish itself as the leader in software technology for critical systems in cars, medicine, robotics, and other industrial uses. Recently, its QNX segment is showing increasing momentum as this push is finally coming to fruition.
The global connected car market is big and rapidly growing. According to estimates, the global connected car market is expected to grow to US $420 billion by 2032. This represents an approximately 20% compound annual growth rate (CAGR). Blackberry is very much a part of this with an over 50% market share. You can find the company’s QNX software in more than 275 million cars and more than 270 makes and models, including those from the world’s top 10 automakers and top 5 Tier 1 suppliers.
Latest results
Blackberry’s latest results demonstrate the momentum that the company is finally seeing in its business.
After a strong fiscal 2026, this TSX stock has kept the momentum in fiscal 2027. Total Q1 revenue increased 26% to $152.9 million. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased 144% to $36.3 million. And adjusted earnings per share (EPS) came in at $0.04 compared to $0.02 in the same period last year.
Blackberry’s QNX segment revenue also increased 26% to $72 million with a gross margin of 86%. This was driven by all components of QNX, including development licenses, professional services, and royalties.
The bottom line
Blackberry is an undervalued TSX stock that is rising from the ashes. While it has taken a long time, momentum is picking up steam and Blackberry stock is very well-positioned in both the IoT and the cybersecurity industries. An ideal long-term holding.
