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BlackBerry Ltd BB

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Morningstar’s Analysis

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5-Star Price

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Economic Moat

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Capital Allocation

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BlackBerry Shares Showing Signs of Irrational Exuberance; Maintain $6.40 FVE; Shares Overvalued

Analyst Note

| William Kerwin |

No-moat BlackBerry’s shares have more than doubled this month, but we have seen no material fundamental changes in the business. While small pieces of news concerning the firm’s licensing business have come out, these have been part of normal business operations, and we don’t expect them to be material to the firm’s cash flows. We think the recent price appreciation has been a result of a change in market sentiment rather than improved firm fundamentals. We maintain our $6.40 fair value estimate for BlackBerry and view shares as significantly overvalued.

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Company Profile

Business Description

BlackBerry, once known for being the world’s largest smartphone manufacturer, is now exclusively a software provider with a stated goal of end-to-end secure communication for enterprises. The firm provides endpoint management and protection to enterprises, specializing in regulated industries like government, as well as embedded software to the automotive, medical, and industrial markets.

Contact
2200 University Avenue East
Waterloo, ON, N2K 0A7, Canada
T +1 519 888-7465
Sector Technology
Industry Software - Infrastructure
Most Recent Earnings Nov 30, 2020
Fiscal Year End Feb 28, 2021
Stock Type
Employees 3,668

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