Count CIBC analyst Todd Coupland amongst those believing in BlackBerry (BlackBerry Stock Quote, Chart, News, Analysts, Financials NYSE:BB) a little less these days.
As reported by The Globe and Mail, Coupland, on October 19, cut his price target on the stock from (US) $5.50 to $4.75, while maintaining his “Neutral” rating on the stock.
The action came on the heels of the BlackBerry Summit, a conference in which the Waterloo-based company reveals its more recent innovations. Coupland portrayed a company currently defined by its uncertainty.
“Blackberry’s summit in New York provided known technology updates on the value of its Cyber and IoT units and the company’s convergence strategy,” the analyst explained. “The IoT subsidiary IPO for 20-30 per cent of the unit is planned for June 2024 with the S-1 expected in the spring of 2024. A near-term sale of the Cyber business appears unlikely as the company revealed Cyber’s lack of growth and profitability meant it had only received unattractive offers. Finally, no update on CEO John Chen’s plans was provided, as conversations between he and the board have yet to take place on his contract which expires on November 3. Both the Cyber and IoT units continue to face headwinds and are negative for Blackberry’s share price. Chen confirmed that IoT would experience ‘a dent in its rebound,’ but reaffirmed an expectation for record revenues in FQ4.”
On October 4, BlackBerry announced its intention to divide its Internet of Things and cybersecurity businesses via an initial public offering.
“The board and management believe that separating our principal businesses will improve our ability to create value for all our stakeholders,” CEO John Chen said. “Both the IoT and Cyber businesses have leading technology and talent and address large and growing market opportunities. This new proposed structure will further increase both their operational agility and ability to focus on delivering exceptional solutions to their customers.”
At press time, shares of BlackBerry on the NYSE were down 2.9 per cent to $3.4675.
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