Imperial Capital Remains Sidelined on BlackBerry (BBRY) Following 3Q Report

Imperial Capital maintained an In-Line rating on BlackBerry (NASDAQ: BBRY), and cut the price target to $8.25 (from $8.50), following the company's 3Q earnings report. BlackBerry reported adjusted revenue of $301mn and adjusted EPS of $0.02, compared with Street revenue estimates of 328mn and adjusted net loss per share estimates of 0.01.

Analyst Michael Kim commented, "We are maintaining our In-Line rating on BBRY shares and lowering our one-year price target to $8.25 from $8.50 based on sum-of-the-parts valuation. Our price target implies potential upside of 10% above recent levels. We believe BBRY is achieving incremental progress on its turnaround strategy and pivot to software and services, notwithstanding accelerated declines in Service Access Fees (SAF). We are tempering our FY18 software revenue estimates based on more conservative contribution from QNX (embedded systems) and developing pipeline for BlackBerry Secure (enterprise mobility platform). We see potential upside from new licensing agreements for the company’s intellectual property (IP), device software licensing (e.g., TCL Communication), and Radar (asset tracking solution). Beyond FY18, we see ramping software opportunities from Internet-of-Things (IoT) and connected cars and autonomous driving applications. However, at recent levels, we think BBRY shares offer balanced risk/reward and we would seek a more attractive entry point."

For an analyst ratings summary and ratings history on BlackBerry click here. For more ratings news on BlackBerry click here.

Shares of BlackBerry closed at $7.50 yesterday.

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