BlackBerry Ltd: Smart Money Optimistic On Growth Prospects

BlackBerry is still in the turnaround phase, but it appears its recent efforts have caught the attention of smart money. Many large investors are optimistic on the Canadian firm’s growth prospects and have boosted their stakes in the company.

BlackBerry attracting smart money

Great West Life Assurance boosted its BlackBerry holdings by 4.2% in the fourth quarter. Great West acquired 24,771 shares during the period, after which its total holdings stretched to 621,138 shares. Beech Hill Advisors also boosted their stake in the Canadian firm by 245.7% during the quarter. The firm bought 27,850 shares during the quarter, after which it now owns 39,185 shares.

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Numeric Investors LLC initiated a new stake valued at about $1.093 million in the Canadian firm during the last quarter. Also Capital Fund Management S.A. acquired a new stake during the fourth quarter valued at about $582,000.

Not all are bullish in the Canadian firm. During the fourth quarter, TD Asset Management lowered its stake in the company by 4.4%, according to its recent 13F filing with the SEC. The investment firm sold 183,820 shares during the quarter, after which it was left with 3.96 million shares of the smartphone maker.

What makes it attractive?

According to a report from Insider Monkey, the number of long hedge fund positions in the Canadian firm’s stock was up by 33% during the last quarter of the year. At the end of the quarter, BlackBerry was in 24 of the tracked hedge funds with total positions worth over $786 million. In the previous quarter, about 18 hedge funds had positions in BlackBerry with stakes amounting to just $470 million.

BlackBerry is trading at a high PE of 129, but its price-to-book ratio is decent at 1.19, thanks largely to its massive cash reserves of about $2.5 billion.

“Given its intriguing push into a high-growth segment and the potential for BlackBerry to be the target of a takeover, the stock appears to be an attractive buy-low option at the moment,” says Insider Monkey.

On Tuesday, Vetr upgraded the Canadian firm from Buy to Strong Buy with a price target of $9.50. In premarket trading today, BlackBerry shares were down marginally. Year to date, the stock is down by over 12%, while in the last year, it is down by almost 24%. The stock has a 52-week high of $11.09 and a 52-week low of $5.96.