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Nomura Cuts BlackBerry Price Target, Sees 'Rocky Road To Recovery'


Nomura reiterated its Neutral rating on BlackBerry Ltd (NASDAQ: BBRY) Monday and cut its price target from $10.60 to $10.30.

Analyst Stuart Jeffrey felt the company has a “rocky road to recovery” and he continued to look for “reasons to be more positive.”

“The key dynamics around the stock, in our view, are: Earnings have turned and new product platforms have launched, potentially seeing BlackBerry transition from a failing handset vendor to a vibrant supplier of enterprise mobility management solutions,” according to Jeffrey.

“This transition could drive a recovery in revenues within the next 12 months. Near-term estimates continue to miss expectations, making it hard to confidently project a bottoming out in revenue trends. The new product platforms that are needed to drive future software revenues are still immature and forecasting their impact remains challenging.”

Jeffrey noted that we “need to see a marked acceleration in the market-wide adoption of enterprise mobility management solutions to justify significant upside in fair value. Intuitively, such a trend seems likely but numbers are still low and the timing or scale of the material uptick that is likely needed to drive the stock remains hard to forecast.”

The analyst note adjusted FY15E EPS from ($0.22) to ($0.18) and FY16E EPS from ($0.20) to ($0.51).

BlackBerry recently traded at $10.43 up 4.35 percent.


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