BlackBerry is a “dice roll”, Jim Cramer says

A dice roll.

That’s what stock pundit Jim Cramer calls BlackBerry (BlackBerry Stock Quote, Chart, News, Analysts, Financials NYSE:BB) stock right now.

On March 4, on “Cramer’s Lightning Round”, a segment of his CNBC program “Mad Money”, Cramer delivered that three word assessment of the recently resurgent Canadian company.

So is this bad news for BlackBerry? Almost certainly not.

The research paper “Booyah! An Analysis of Mad Money Stock Recommendations” by Matthew Dakken of the Minnesota State University Moorhead is one of several academic studies into the returns of the affable American stock picker. It found what many other papers did -that Cramer might be best regarded as entertainment rather than investment advice.

“There is little evidence present in previous research to suggest that Jim Cramer can outperform the market over the long-term,” the author wrote. “Keasler and McNeil (2008) see no evidence of positive long-term abnormal returns in their research. Furthermore, they observe that unadjusted raw returns on recommended stocks underperform the market index by 7.1 percent over their thirteen-month study. Lim and Rosario (2010) reach a result contrary to Keasler and McNeil (2008). In their study, long-term positive excess returns for non-caller picks are 1.00 percent greater than their benchmark. Furthermore, they note that returns on Cramer recommended stocks may be hindered by a few factors, including the fact that Cramer makes new picks each show to generate new content, which might lead to diminishing quality in recommendations. Another possible factor is that he often advocates for an active trading style, which is not easily captured by a simple buy-and-hold analysis.”

BlackBerry, which is listed on both the TSX and NYSE, has been a stellar performer of late. And it does have recent support amongst some in the investment community.

CIBC Capital Markets analyst Todd Coupland on February 25 raised his price target on the stock from (US) $6.00 to $7.00.

“Our revised target is based on the F2027 outlook Blackberry provided at its Oct. 16, 2024 Investor Day, and higher valuation multiples,” the analyst explained. “We previously included the F2027 outlook and excluded Cylance, but we raise our multiples to include eight times 2027E EV/sales (prior seven times) and 40 times EV/EBITDA (prior 30 times) for QNX — both of which are comparable to peers. During this NDRS, Blackberry confirmed the favourable trends reported in FQ3. Those, together with C-suite decisions throughout C2024, a conservative guiding philosophy, and adjustments to the Board of Directors, support our positive thesis that guidance is achievable. We believe Blackberry shares are attractive and should be purchased.”