What Is BlackBerry Limited's (TSE:BB) Share Price Doing?
BlackBerry Limited (TSE:BB), is not the largest company out there, but it received a lot of attention from a substantial price increase on the TSX over the last few months. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s take a look at BlackBerry’s outlook and value based on the most recent financial data to see if the opportunity still exists.
View our latest analysis for BlackBerry
What's The Opportunity In BlackBerry?
According to my valuation model, BlackBerry seems to be fairly priced at around 4.7% below my intrinsic value, which means if you buy BlackBerry today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth CA$6.13, then there’s not much of an upside to gain from mispricing. Is there another opportunity to buy low in the future? Since BlackBerry’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
Can we expect growth from BlackBerry?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. With profit expected to grow by 39% over the next couple of years, the future seems bright for BlackBerry. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.
What This Means For You
Are you a shareholder? It seems like the market has already priced in BB’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping an eye on BB, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
If you'd like to know more about BlackBerry as a business, it's important to be aware of any risks it's facing. Case in point: We've spotted 1 warning sign for BlackBerry you should be aware of.
If you are no longer interested in BlackBerry, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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