Should you sell your BlackBerry stock?

Ahead of its Q2 report, RBC analyst Paul Treiber remains on the fence about BlackBerry (BlackBerry Stock Quote, Chart, News, Analysts, Financials NASDAQ:BB), but sees some potential building.

As reported by the Globe and Mail, Treiber September 22 maintained his “Sector Perform” rating and target of (US) $4.00 on BlackBerry.

The analyst says the quarter may come in slightly better than expected.

“The company typically provides conservative guidance, as actual revenue has exceeded consensus by 6 per cent and actual adj. EPS has beat consensus by $0.02 on average over the last 4 quarters,” he wrote. “Since the macro environment was likely more stable than guidance assumed, we believe Q2 revenue may slightly exceed RBC/consensus at $125-million/ $122-million. Excluding Cylance (divested), our revenue estimate implies 0-per-cent year-over-year growth. Q2 adj. EPS may also come in above RBC/consensus at $0.01. BlackBerry has averaged actual quarterly adj. EBITDA $12-million above consensus over the last 4 quarters,” he noted. “Due to likely higher revenue and continued cost discipline, we believe Q2 adj. EBITDA may slightly exceed RBC/consensus at $12-million and BlackBerry raise FY26 adj. EBITDA guidance from $72-87-million to $75-90-million (vs. consensus at $81-million).”

The analyst says he could see a path to upward revision for BB.

“BlackBerry is trading at 4.5 times NTM EV/S [next 12-month enterprise value to sales], which is a 31-per-cent discount to auto tech peers,” he said. “We believe a sustained upwards rerating is dependent on: 1) strengthening IoT growth; and 2) realization of improved profitability.”

At press time, shares of BlackBerry were even at (US) $4.21.