Wells Fargo: BlackBerry 'Surprise' Gross Margin Could Hit 40% Area, Stock Has Valuation Range Of $8-$9
BlackBerry Ltd (NASDAQ: BBRY) stock has risen slightly in Wednesday's after-hours trading amid commentary from Wells Fargo analyst Maynard Um, who holds a Market Perform on shares with a valuation range of $8 to $9.
Um, in particular, sees a potential sale "less likely" in the immediate future, and said BlackBerry could look at other strategic alternatives. His latest update looked into the company's Q1 2016 10Q and broke the document down into a few key points.
In Um's words, they include:
- "Surprise is gross margin guided “to be in the 40% area.”"
- "Software revenue expected to increase by “more than 20%,” excluding revenue from technology licensing versus last FY."
- "Operating expenses to increase over the next few quarters; our/Street estimates at risk. Implied hardware gross margin declined to low/mid-single digits."
- "Rescinds FY16 BBM revenue guidance of $100MM."
- "Maintains Service revenue decline of 15% each quarter for FY16."
- "Lack of new hardware releases could weigh on hardware sales."
Latest Ratings for BBRY
|Sep 2016||Morgan Stanley||Maintains||Equal-Weight|
|Sep 2016||Credit Suisse||Maintains||Underperform|
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