BlackBerry (TSX:BB) Is Flying High: Should You Buy?

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 After 2020, BlackBerry (TSX: BB) (NYSE: BB) has made a grand debut in 2021, with the stock soaring nearly 48%. Last week, news surfaced that the company had sold 90 smartphone technology patents to Huawei in December, which were later confirmed by the company’s CFO, Steve Rai, during a January 12 JP Morgan virtual investor conference. This initiative may be part of the company. Strategy to move away from mobile phone space.

On Friday, the company also said it had settled a dispute with Facebook related to patent royalties, not disclosing the terms of the settlement. These developments boosted the company’s share price by more than 30% last week. Given the recent surge in the company’s share price, is BlackBerry still a buy at these levels? 

Growth driver

Last month, BlackBerry announced that it collaborated with Amazon Web Services to develop and market its intelligent vehicle data platform IVY. The platform will allow automakers to safely access the vehicle’s sensor data to responsive in-vehicle services, thereby enhancing the driver and passenger experience. The platform will run inside the vehicle’s embedded systems while being remotely managed and managed through the platform.

Using BlackBerry’s IVY, automakers can develop new products and services that can work on different vehicles and models, thus cutting expenses. The company hopes to implement the platform in the 2023-year auto model. Therefore, given its advantages, this platform can contribute significantly to its recurring revenue in a few years.

Meanwhile, BlackBerry is also strengthening its position in the cyberspace and endpoint management solutions market through its Spark Suite and Cyber ​​Suite platforms. Meanwhile, initial interest in cyber suits also seems healthy, as it brings the best technology from both Blackberry and Silence.

Evaluation and Recommendations from Analysts

Despite its recent boom, BlackBerry’s valuations still sound attractive. Currently, the company’s forward price-to-sales and price-to-book multipliers are 4.8 and 2.4, respectively.

Meanwhile, analysts were less bullish on the company. 8 of the 9 analysts covering BlackBerry have a “hold” rating, while one analyst has issued a “sell” rating. The consensus price target represents a drop of approximately 60% from its current stock price.