BlackBerry is moving from defense to offense, says Cormark analyst Tse

BlackBerry CEO John Chen. BlackBerry’s (TSX:BB) turnaround has been an uphill battle, but the company is now staring down a “sizeable revenue opportunity” if it is able to execute on a shift towards enterprise customers, says Cormark analyst Richard Tse.

In New York yesterday, Tse met with BlackBerry CEO John Chen and CFO James Yersh. The analyst says a different tone has set into the company. Unlike last year, he says, BlackBerry’s focus isn’t all about cutting costs or selling assets. Instead, the dialogue was about “laying the foundations for growth”. Tse says BlackBerry now has the flexibility to make moves without being buried in restructuring.

One of Tse’s main takeaways from the day? “John Chen is impressive”. While it has been hard to assess Chen’s approach to the turnaround, says Tse, “there’s little doubt” that BlackBerry’s leadership is extremely capable. The analyst says it was refreshing to see a more focused BlackBerry, and he sees a reasonable basis for growth in many of its business opportunities, such as BBM, handsets, BES and QNX.

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Tse says the announcement made yesterday that BlackBerry has acquired Secusmart will play “a big part” in fortifying its backbone in enterprise, especially in regulated enterprises. Overall, he says, enterprise interest is scaling.

All of this adds up to a subtle reversal for BlackBerry’s fortunes, says Tse. “What we heard was the potential for hiring,” he said. “…moving the company from defense to offense – a pleasant surprise.”

In a research update to clients this morning, Tse maintained his “Buy” rating and one-year target of (US) $11.50 on BlackBerry. The analyst, however, says he will be looking to reevaluate this target after some reflection.