TD Securities Thinks Surge in BlackBerry (BB) is "Over-Reaction"

December 1, 2020 2:38 PM EST
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Price: $10.16 -1.84%

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TD Securities analyst Daniel Chan commented on BlackBerry Limited (NYSE: BB) following its announcement of a deal with AWS, calling the impact slightly positive and long term opportunity. He also said today's spike higher in shares an "over-reaction."

"BlackBerry is entering a multi-year, global agreement with Amazon Web Services (AWS) to develop and market BlackBerry IVY ... We are surprised that the market has reacted so strongly to the news, considering we do not expect this to be commercially available for at least three years. We believe this is an over-reaction and expect the share price to come back down in the coming days," said Chan.

Chan added, "With the stock trading well above the US$6.00 convert price, we believe that debt holders could convert. If converted, we estimate that the share count would increase by ~11% and that Fairfax would hold ~16.5% of BlackBerry. "

Chan has a Hold rating and $5.50 price target on BlackBerry Limited (NYSE: BB)

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

Shares of BlackBerry Limited closed at $5.87 yesterday.

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