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SocGen Cuts BlackBerry (BBRY) to Sell; Launch of New 'Jakarta' Handset Won't Impact Recent Quarter

March 27, 2014 9:12 AM EDT
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Price: $11.57 --0%

Rating Summary:
    4 Buy, 31 Hold, 12 Sell

Rating Trend: = Flat

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    Up: 13 | Down: 10 | New: 11
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Société Générale downgrades BlackBerry (Nasdaq: BBRY) from Hold to Sell, while keeping its $6 target price on the stock.

Analyst Andy Perkins doesn't expect a pick-up with the BlackBerry's handset division in its final quarter as demand has shown sharp contraction. The analyst commented, The new handset (the Blackberry “Jakarta”) will launch in April and so will have no impact on the historical results. Additionally, we forecast that Services revenues will also be down almost 13% sequentially as subscriber accounts continue to fall.

Perkins' call comes following a rapid increase in BlackBerry's stock price over the last few months. The sum-of-parts valuation for the analyst's $6 price target is cash at $2 per share, subscriber services at $2.70 per share, patents at $1.30 per share, and no value for handsets.


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