Why Nasdaq At 5,000 Makes Blackberry 'Relevant'

BlackBerry Ltd BBRY is slowly progressing to becoming a pure enterprise software play, detaching itself from the smartphone space that it once ruled. However, rather than being concern a lot of analysts are actually praising this step as one in the right direction by the company.

Among them is Colin Gillis of BGC Financial, who was on CNBC Monday to discuss why he is bullish on the stock.

No More A Smartphone Maker

"It's Blackberry the software company, Gillis said. "So, all those people who are out there talking about Passport and Classics, retrain your thinking because this is a enterprise software play and now it's relevant because NASDAQ [is at] 5000, you want to find out what stocks still have good upside potential in them and Blackberry is one of those names."

He continued, "It's a special situation, it's a turnaround. We are very positive on the new management John Chen, who is re-shaping this company to being an enterprise mobility management play- let's manage all the software on other companies' networks."

Hardware Is Still Stop-Gap

When asked whether Blackberry will have a higher valuation if it liquidated its hardware division and starts focussing on becoming a software company, Gillis replied, "You may see that happening. You've already seen steps to reduce the dependency by working with partnerships to outsource a lot of the hardware development."

"Now, the hardware, phones are still going to be a stop-gap over the next year as they build-up their software revenue stream. They have got a target of $500 million for software, it's about double of where we are at right now, they have a target of $100 million for BBM for a base of about zero right now."

"So that's both pretty lofty targets, but this management has delivered. You have got $6 billion in market-cap with $3 billion in cash. So, we see some nice upside," Gillis concluded.