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Deutsche Bank Unconvinced Following BlackBerry Analyst Day

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Brian Modoff of Deutsche Bank is skeptical of BlackBerry Ltd's (NASDAQ: BBRY) prospects of a full turn-around following the company's analyst day in San Francisco on Wednesday.

"We came away slightly more encouraged on the overall plan for the company," Modoff wrote in a note to clients on Wednesday. "However we still believe the challenge to offset the declining service revenues remains significant."

Modoff notes that BlackBerry's management disclosed several key developments in its business, including deals with Samsung, Salesforce and others as part of a "go-to-market strategy" for its new Enterprise Mobility Management (EMM) platform. In addition, the company revealed VPN authentication, a BBM meeting solution, secure voice and text and a dual soft SIM.

However, the analyst believes that BlackBerry's main challenge ahead lies in its ability to convert free, trial customers to paying ones. Modoff states, "while we appreciate the work done to put out these new feature sets, we are cautious on the number of trial customers they will convert."

Shares are Hold rated with a $9 price target.

BlackBerry shares are down 4.6 percent at $11.49 on Friday afternoon.

 

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