Morgan Stanley Says BlackBerry Classic 'Probably Isn't For You'
Morgan Stanley commented on BlackBerry Ltd (NASDAQ: BBRY) Thursday and maintained an Underweight rating.
Analysts led by James E. Faucette commented that “the Classic probably isn’t for you (at least definitely not for your kids).”
The reason it isn’t for most of us is that the new BlackBerry Classic, announced Wednesday, “is intended to address that portion of the BlackBerry subscriber base that hasn’t upgraded their BlackBerry in 4 years or more.”
Faucette estimated that “the market for the new Classic device is likely to be limited to roughly the 8 million existing enterprise subscribers, particularly given the high price point.”
In other areas, Faucette noted that “product strategy with Samsung [is] still in the talking phase” with initial software to be available in late Q1 2015.
Related Link: Why 1 Analyst Thinks BlackBerry Is In 'reinvention Mode'
Faucette was “skeptical that BlackBerry can hits its stated targets of $500mm in software revenue during FY16 (which we estimate would imply roughly $350-$400mm in new revenue from enterprise software and services for the year and exiting FY16 on a roughly $800mm per year run rate), especially because, by our estimation, the number of smart devices in Western developed markets that are managed by some sort of EMM/MDM solution has remained roughly flat at ~28-32mm since 2011.”
As an alternative, “BlackBerry needs to put out of business all the competitors that have consistently taken share from BlackBerry during the last 4 years out of business. Either way, it all seems unlikely to us,” Faucette concluded.
BlackBerry traded at $10.17 in the premarket, up 1.90 percent.
Latest Ratings for BBRY
|Sep 2016||Morgan Stanley||Maintains||Equal-Weight|
|Sep 2016||Credit Suisse||Maintains||Underperform|
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