Critical Analysis: BlackBerry (NYSE:BB) versus The Competition

BlackBerry (NYSE: BB) is one of 33 publicly-traded companies in the “Wireless Telecommunications Services” industry, but how does it weigh in compared to its peers? We will compare BlackBerry to similar businesses based on the strength of its earnings, analyst recommendations, profitability, institutional ownership, dividends, valuation and risk.

Risk and Volatility

BlackBerry has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500. Comparatively, BlackBerry’s peers have a beta of 0.85, meaning that their average share price is 15% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for BlackBerry and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
BlackBerry 3 10 4 0 2.06
BlackBerry Competitors 523 1691 1862 63 2.35

BlackBerry presently has a consensus target price of $9.54, indicating a potential downside of 10.47%. As a group, “Wireless Telecommunications Services” companies have a potential upside of 28.94%. Given BlackBerry’s peers stronger consensus rating and higher possible upside, analysts clearly believe BlackBerry has less favorable growth aspects than its peers.

Institutional and Insider Ownership

59.2% of BlackBerry shares are owned by institutional investors. Comparatively, 40.3% of shares of all “Wireless Telecommunications Services” companies are owned by institutional investors. 22.7% of BlackBerry shares are owned by company insiders. Comparatively, 12.5% of shares of all “Wireless Telecommunications Services” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares BlackBerry and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
BlackBerry $1.31 billion -$1.21 billion 12.69
BlackBerry Competitors $27.09 billion $1.51 billion -259.12

BlackBerry’s peers have higher revenue and earnings than BlackBerry. BlackBerry is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares BlackBerry and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
BlackBerry 49.62% 2.70% 1.78%
BlackBerry Competitors -313.82% -4.21% -9.87%

Summary

BlackBerry beats its peers on 7 of the 13 factors compared.

BlackBerry Company Profile

BlackBerry Limited (BlackBerry) provides mobile communications solutions. The Company is engaged in the sale of smartphones and enterprise software and services. The Company’s products and services include Enterprise Solutions and Services, Devices, BlackBerry Technology Solutions and Messaging. It is engaged in providing enterprise mobility management (EMM) and mobile security, and offers a portfolio of enterprise software solutions and services that can be deployed across a range of ecosystems and devices, including BlackBerry Enterprise Service (BES) 12 and Good Platforms, BES12 Cloud, enterprise file-sync-and-share (EFSS), SecuSUITE for Enterprise, Enhanced subscriber identity module (SIM)-Based Licensing (ESBL), WorkLife by BlackBerry solution and Professional Cybersecurity Services. The BlackBerry Technology Solutions business unit consists of five units: QNX, Certicom, Paratek, the BlackBerry IoT Platform and Intellectual Property and Patent Licensing (IPPL).

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