BlackBerry has a rough week; Whitehouse teetering, analyst upgrades, earnings, and more

Obama facing Blackberry blackout

The Wall Street Journal reported late yesterday that the White House technology team and White House Communications Agency are working on testing alternate devices for use by The White House and President Obama, but are allegedly “months away” from qualifying those devices for use. Analysts at CSLA lift BBRY rating to “underperform” from sell, marking the first time this March we’ve heard a positive bit of news on the stock. Year-end earnings approach, as we near March 28th; Chen and BlackBerry are making moves to get lean and dominate – will they work?First off we start with some news that just doesn’t make sense to me (which is why I waited to address it). WSJ reports the DOD and Co. are performing tests on rival smartphones – looking to possible replace BlackBerry – the Federal government’s sole provider for over 10 years. This is odd, considering BlackBerry CEO, John Chen, had recently met with the President and White House officials in regards to the future of BlackBerry use for government operations. This is also odd considering the Pentagon recently reverted back to BlackBerry legacy devices, citing a need for increased security against any possible international security threats. Although it wasn’t an order for new BB10 phones, it makes a statement that BlackBerry has used in the past and present to secure (no pun intended) themselves as the leading provider of Federal government smartphones.

As we’ve reported in the past, BlackBerry has a definite advantage against Android and Apple phones, being awarded the highest security authority over any of the other platforms (or phones) tested by the Department of Defense. In fact, that article reported, “The U.S. Defense Information System Agency…is architecting the capacity to support 10,000 BlackBerry 10 smartphones by this fall and 30,000 by the end of 2013 on DoD networks,” per the press release. I call this all BUNK!

Better news, however, as CLSA reports that they think, “the company is likely to report lower losses going forward”. This is good news for investors, but peculiar as to why the stock took a nose dive toward the end of trading. Hopefully this will start a positive trend for BlackBerry entering into April – after the Year-end and Fiscal Q4 earnings report is released on March 28th, 2014. The report will be for the fiscal Quarter ending Feb 2014. According to Zacks Investment Research, based on 19 analysts’ forecasts, the consensus EPS forecast for the quarter is $-0.56. The reported EPS for the same quarter last year was $0.22. Make sure you sign up to join that call on the 28th to hear it first.

As we may not see the immediate benefit from the real estate holding sales in both the US and Canada this quarter, the past three months were a trying time for BlackBerry. We can use them as a gauge for the direction and potential success in the coming months. Only a month into the new fiscal year, we can only hope for more of a turn-around moving forward.

While it is unclear why any of this would take the stock in the direction it went on the close of the week, I personally think after the earnings call, the dust will settle and the stock will rise. However, prior to the market closing, after gaining nearly 1% on today’s session, BlackBerry (NAS: BBRY) dropped nearly a quarter-point (-0.24%) to close at $9.18 ending the week with a net loss and a story that was released to impart more fear on those investing in the stock. The momentum from this week will carry on to next, as we see more stagnation in price of the stock until after the earnings are released. 

As always, stay tuned for more from us on BlackBerry – your #1 source for news NOW.

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