BlackBerry Ltd Experienced Heavy Call Options Trading Monday

Diversified tech firm BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) shares witnessed well above average options trading activity on Monday. Investors bought 24,852 call options on the company, which is a surge of 101% compared to the typical daily volume of 12,347.

Rumored Lenovo deal helped stock

A number of analysts have assigned ratings on the stock recently. Canaccord Genuity maintained its Hold rating on the stock in a research note to the investors on October 13^th. Imperial Capital analysts initiated coverage on BlackBerry through a research note published on October 6^th. Analysts at ING group have also started coverage on the firm as of October 6^th. The Canadian company has an average rating of Hold and a consensus target price of $8.83.

Just a few days back, there were reports indicating that Lenovo might acquire BlackBerry. Investors who are still hoping that BlackBerry will return to profitability, drove the shares up 9% after the news. Earlier, a report from the Globe and Mail citing a source close to BlackBerry says that the chances of Lenovo succeeding are slim, and the Canadian smartphone maker has not initiated any such discussion with Lenovo. Furthermore, Lenovo will have to overcome potential hurdles from U.S. and Canadian securities regulators to complete a deal for BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB).

BlackBerry shareholders supporting turnaround

The Waterloo, Ontario-based company was almost on the verge of bankruptcy when it entered into merger discussion with Lenovo last year. In 2013, the new phone launches of the company were weak.

Currently, however, BlackBerry is recovering under new chief executive officer John Chen, and the latest new phone (Passport) is garnering good sales. Fairfax Financials, who is a major shareholder in the company, also seems to be relaxed.

Fairfax founder and major BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) shareholder, Prem Watsa has a reputation of being a long-term value investor. Watsa has paid an average cost of $17 per share for his BlackBerry stake, which suggests that he will not be willing to sell out for much less.

BlackBerry shares were up 2.40% to $10.65 in trading Tuesday, while year to date shares are up over 46%.