BlackBerry (NYSE:BB) has been a sensation with consumers and BB stock has been a favorite among investors. (Though it’s success has admittedly been of the one-hit wonder variety). Today there’s a key question those interest in buying the stock should consider: Does BlackBerry have what it takes to be something more going forward?
Here’s a closer look at what you might expect from BlackBerry in a long-term timeframe.
A Brief Look at BB Stock
BlackBerry is up 61% in 2021. But for the vast majority of this year’s freshly positioned shareholders, owning BB stock is likely to feel vastly different. In many cases, it might even be painful.
The fact is BlackBerry’s stock has endured a volatile (and not always bullish) year of price movement. At its best BB shares fetched just over $28. But an ensuing and hard-hitting correction also sank the stock as low as $7.71.
You get the point, right? There’s more too.
For the past ten straight months BB shares have traded beneath the stock’s 62% retracement level, which is tied to its January high and nowhere close to making many investors whole again.
What’s more, today shares are still only changing hands near $10.70.The reality of what BlackBerry has done for most investors in 2021 isn’t reflected in its advertised gain of 61%.
But can or should those bulls expect more from BB stock looking into 2022 and beyond?
What to Expect From BlackBerry Moving Forward
One knock against BlackBerry doing better for its shareholders could be the fact BB stock also generated its best returns back in January riding the coattails of GameStop (NYSE:GME). But it’s not necessarily that simple.
Unlike GME’s over-the-top short-squeeze, where short interest measured more than the entirety of the stock’s float, BB’s bearish float never exceeded 10%.
BB stock’s short data is high, but far from extraordinary. And while its shareholders may not enjoy GME’s “January 2021 effect” again, maybe this says something more about BlackBerry as an actual investment?
BlackBerry isn’t a great meme stock either. But is that really an issue or a positive?
For those old enough to have had or remembered what a first-generation smartphone looked like back in the early 2000’s, Blackberry was king. Then it got pummeled by Apple (NASDAQ:AAPL) with the introduction of the iPhone.
The rest is history of course. And if you were to dust off a Blackberry buried deep in an office drawer somewhere and show it to someone of a certain age, the laughter could prove deafening.
That being said, and to be fair to that obliviousness, superficially BB stock is a meme stock.
Yet today’s BlackBerry actually has a lot more going for it than meme-based, trading schemes backed by the number of mentions, mudslinging, hashtags, cute gifs and other silly crap that has become a notorious part of playing the stock market in r/WallStreetBets and other chat forums.
The real genie in the bottle for BB stock investors is the company’s pivot. Specifically, BlackBerry has transitioned from tech hardware into cloud-based software for cybersecurity, autonomous autos, Internet of Things (IoT) applications and other burgeoning markets the past few years.
And judging by its most recent better-than-forecast quarterly results in late September, Blackberry 2.0 is working.
Will BB stock work its magic once more for the Reddit crowd? Probably not, but that shouldn’t dissuade other investors from buying into another sort of BB narrative.
To be clear, there’s still red ink at Blackberry.
Yet, things aren’t necessarily as glum for longer-term BB stock investors. As InvestorPlace’s David Moadel notes, growing sales and new partnerships in some of today’s key markets, projected profits for next year and healthy cash reserves all bode well for BlackBerry moving forward.
A Closer Look At BlackBerry’s Monthly Price Chart
Source: Charts by TradingView
Unlike January’s huge stock spike or June’s lesser fast-money operations, buying into BlackBerry isn’t a get rich quick scheme. And at the moment, BB stock’s monthly price chart reflects that premise.
Technically, shares have confirmed October’s higher-low candlestick this month. It sets up what looks like an emerging uptrend. That’s the good news.
The concern, if any, is BlackBerry shares have reversed back inside the doji candle. At the same time, stochastics have yet to confirm the bullish low with a crossover.
Also, the observation is that if BB’s uptrend is to mature, right now the angle of ascent looks like more of grind for shareholders.
Similar to BlackBerry’s inroads within the company’s business pivot and turnaround, BB stock obviously has its work cut out for it. Still, the overall situation looks promising.
For investors agreeable with this cautious optimism, a Jan $9/$14 collar on BB stock is a favorable, fully hedged and adjustable position. It’s agreeable with what’s happening both off and on the price chart.
On the date of publication, Chris Tyler did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Chris Tyler is a former floor-based, derivatives market maker on the American and Pacific exchanges. For additional market insights and related musings, follow Chris on Twitter @Options_CAT and StockTwits.