3 Reasons to Never Sell BlackBerry (TSX:BB)
The Motley Fool
Published Sep 21, 2021 08:00
Updated Sep 21, 2021 08:16
3 Reasons to Never Sell BlackBerry (TSX:BB)
Tech stocks like BlackBerry (TSX:BB)(NYSE:BB) are often considered to be valuable part of investor portfolios, possessing the potential to deliver stellar shareholder returns. Investing in technology has become increasingly popular, especially during the pandemic due to the favourable conditions for the industry created by the global health crisis.
However, shares of the Canadian tech company have taken its investors on a roller-coaster ride of emotions over the last decade. The stock fell from a record high of $247 in 2007 to a mere $6.12 per share in September 2012. What was once a leading mobile phone manufacturer was left miles behind by the now well-known tech giants Apple (NASDAQ:AAPL) and Samsung (KS:005930), among many others still emerging in Asian markets.
Now, the company is out of the smartphone market, but the tech company is not down and out. It shifted its focus to the less exciting but very important enterprise-based software and security solutions market. Investors have been waiting for the company to provide them with the much-anticipated turnaround that seemingly never comes.
Today, I will discuss why you should buy BlackBerry stock and never sell its shares to help you make a well-informed decision regarding the former mobile phone manufacturing giant.
A strong future in cybersecurity In an increasingly digitized world, the need for enterprise-level cybersecurity solutions will only increase. The pandemic has shown that it is possible for businesses at every level to operate with a remote work structure. It is likely that many companies may choose to stick to such an operating environment long after the pandemic ends.
The company’s cybersecurity segment could drive the company’s growth, as the demand for its endpoint security systems and management systems continue to rise.
IoT and QNX While its cybersecurity sales have not been as strong as expected of late, BlackBerry has benefitted from its presence in two more invaluable spaces: the Internet of Things (IoT) and an embedded operating system for the automotive industry called QNX. Its growing deployment of QNX in vehicles has significantly offset its weaker cybersecurity sales, and its revolutionary OS has already been embedded in over 195 million vehicles.
The company’s recent partnership with Amazon (NASDAQ:AMZN) Web Services to develop and launch another software platform that will exchange and manage vehicle data in a secure environment called IVY by 2022 will provide it with a further boost. While the company continues to post operating losses, it has significantly reduced the figure from US$183 million in fiscal 2020 to just $98 million in fiscal 2021.
Foolish takeaway The $7.28 billion market capitalization stock is trading for $12.85 per share at writing. BlackBerry stock right now is a far cry from what it used to be when it was a dominating presence in the cell phone industry in the early 2000s.
Get The App
The company has respectfully bowed out from the smartphone space, barring a few unsuccessful stints here and there. However, its focus elsewhere on cybersecurity solutions, IoT, and innovating the future of the automotive industry could very well provide it with the necessary means to become an invaluable asset that can provide you with stellar shareholder returns.
It could be worth investing in BlackBerry stock at its current share price.
The post 3 Reasons to Never Sell BlackBerry (TSX:BB) appeared first on The Motley Fool Canada.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon and Apple. The Motley Fool recommends BlackBerry and recommends the following options: long January 2022 $1,920 calls on Amazon, long March 2023 $120 calls on Apple, short January 2022 $1,940 calls on Amazon, and short March 2023 $130 calls on Apple.
This Article Was First Published on The Motley Fool
Written By: The Motley Fool
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.