Karen Thomas, MSc, CFA | 31 March 2021 | More on: BB BB

BlackBerry (TSX: BB) (NYSE: BB) stock really gets retested today The Reddit-induced surge in BlackBerry stock price is over Now let’s get back to basics Long-term fundamentals remain positive But short-term history is something louder

BlackBerry released FY2021 fourth quarter earnings yesterday that was good in some ways but worrying in other ways. Let’s tackle the good news first, BlackBerry QNX is leading the way in transforming automobiles into connected systems of today and tomorrow Tomorrow’s Autonomous Vehicles In the quarter, BlackBerry QNX continued to rebound after being badly hit in the early days of the pandemic

The BlackBerry software has long been used for infotainment systems, acoustics and dashboard functions The expertise has recently expanded It now includes more advanced technologies such as Advanced Driver Assistance Systems These systems are designed to improve driver performance. by automating functions, issuing warnings and intervening if necessary

So back to the good news of the day, BlackBerry QNX returns to pre-pandemic levels, in fact, the company expects double-digit billing growth for fiscal 2022

However, revenue growth is tough to come for BlackBerry right now. Should we ditch the stock as many investors seem to be doing today? I mean, BlackBerry’s share price is down 10%!

I don’t think we should give up the stock. In fact, I’m a buyer of this weakness today

So the CEO of BlackBerry said a lot about the earnings call, most importantly saying that software and services revenues are back to pre-pandemic levels But pre-pandemic revenues at BlackBerry have also been problematic, which is because the Company under construction The conversion of the business model from phones has been a long way

BlackBerry is still under construction today But the light at the end of the tunnel is getting clearer. For example, BlackBerry has won many industry awards for its software. These awards were given for cybersecurity and connected car software, which speaks for the quality of the BlackBerry offer At the same time, BlackBerry is starting to revive interest. This is reflected in double-digit billing growth

The problem here, and a major reason for the weakness in BlackBerry stock today, is simply that the company is in negotiations to sell a large portion of its patent portfolio short-term pain for long-term gain, as this will lead to a stronger focus BlackBerry holds patents in its cybersecurity and connected cars areas This also leads to an inflow of funds This inflow of funds is used to accelerate the growth of BlackBerry For example, acquisitions can be made, and more marketing, sales, and technology expenses may be incurred. All of these will fuel the Company’s penetration of its industries

BlackBerry Stock is in Free Fall Today While the future holds some uncertainty for BlackBerry, the following facts comfort me. First, I believe the Reddit-induced hype buy is out of stock at this point. Second, I believe that BlackBerry is facing major challenges in both business areas With its award-winning software and its partnership with Amazon Web Services, BlackBerry is in a strong position today. I would buy at these levels today

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This article reflects the opinion of the author, who may not agree with the “official” recommendation position of a Motley Fool Premium Service or Consultant We are colorful! Questioning an investment thesis – including one of our own – helps us all think critically about investing and make decisions that will help us get smarter, happier, and richer As a result, we sometimes publish articles that may not match recommendations, rankings, or other content

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, serves on the Board of Directors of The Motley Fool The fool writer Karen Thomas owns shares in BlackBerry David Gardner owns shares in Amazon The Motley Fool owns shares in and recommends Amazon The Motley Fool recommends BlackBerry and BlackBerry and recommends the following options: long calls in January 2022 for $ 1,920 to Amazon and short calls in January 2022 for $ 1,940 to Amazon

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World News – CA – Why is BlackBerry (TSX: BB) stock down 10% today?

Source: https://www.fool.ca/2021/03/31/why-is-blackberry-tsxbb-stock-down-10-today/