Canadian stock report - BlackBerry

CANA

BlackBerry shares post worst quarter in a year August 17, 2018 17:00 EDT

NEWS BITES - NORTH AMERICA

BlackBerry (TSX:BB), Canada's largest Communication equipment company by market cap, has sunk CAD1.68 (or 11.3%) in the past quarter to close at CAD13.13. Compared with the S&P/TSX 60 Index which rose 16.0 points (or 1.7%) in the past quarter, this represented a relative price change of -13%. The volume for the past quarter was 0.6 times average trading per quarter of 181.5 million shares. In the past quarter the market cap has declined CAD836.8 million to CAD7.1 billion (US$5.4 billion). The shares had their worst quarter in a year since the quarter ended August 18, 2017.

Highlights in today's Report:

SECTION 1 BEARISH SIGNALS

SECTION 2 BULLISH SIGNALS

SECTION 3 PRICE VOLUME DYNAMICS

SECTION 4 RELATED NEWS

SECTION 5 GLOBAL RANKING

SECTION 6 SUMMARY FINANCIALS

SECTION 7 PROFILE

SECTION 1 BLACKBERRY BEARISH SIGNALS

1.1 Technicals:

+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 13.24 minus the 26-day EMA of 13.34 is negative 0.1 suggesting a bearish signal. Both EMA prices are falling, another bearish signal.

Low Performance Indicators and rank of BlackBerry in the Canadian market:

DescriptionBB ValueRank In Market
Price to Sales5.8In Bottom Quartile
Price Change %-1.0In Bottom Quartile

1.2 Fundamentals:

Overvaluation [compared with sector average]:

+ Price/Sales of 5.8 [3.2].

+ Price to Book of 3.7 [3.1].

SECTION 2 BLACKBERRY BULLISH SIGNALS

2.1 Technicals:

+ The present value of CAD1,000 (PV1000) invested one year ago in BlackBerry is CAD1,188, for a capital gain of CAD188.

PV$10001-week1-month1-year
BB.TSX9709841,188
S&P/TSX 60 Index1,0039961,099

+ The present value of CAD1,000 (PV1000) invested twenty years ago in BlackBerry is CAD12,157, for a capital gain of CAD11,157.

+ 20 years Multiplier in CAD = 12.157x

+ Compound Annual Growth Rate (CAGR) in CAD = 13.3%

Present Value of USD1,000 invested 20 years ago:

+ The present value of USD1,000 (PV1000) invested twenty years ago in BlackBerry is $US14,027, for a capital gain of $US13,027.

+ 20 years ago CAD 1 equalled USD 0.6592

+ 20 years Multiplier in USD = 14.027x

+ Compound Annual Growth Rate (CAGR) in USD = 14.1%

Aug 17, 2018: CAD 1 equals USD 0.76

High Performance Indicators and rank of BlackBerry in the Canadian market:

DescriptionBB ValueRank In Market
Today's Trading TurnoverCAD16.4 million (US$12.5 million)In Top 2%
Earnings Yield %7.6In Top 7%
Cash to MCap %26.8In Top Quartile
EBITDA Margin %60In Top Quartile
Return on Assets [ROA] %10.7In Top Quartile

2.2 Fundamentals:

+ The earnings yield of 7.6% has a spread of 5.4% vs the 10-year treasury yield of 2.3%. This is the widest and most attractive spread in the past 11 months.

+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 1.4. Compared with the rest of the market the stock is undervalued.

+ Total Liabilities/EBITDA of 2.3 is comfortably below the Joseph Piotroski benchmark of 5.

+ BlackBerry is cash rich with Cash to Market Capitalisation at 26.8%.

2.3 Undervaluation [compared with sector average]:

+ Price/Earnings of 13.1 [16.7].

+ Return on Equity 16.2% [10.7%].

+ Return on Assets 10.7% [6.5%].

+ Return on Capital Employed 12.2% [8.2%].

SECTION 3 BLACKBERRY PRICE VOLUME DYNAMICS

3.1 Volatility:

+ BlackBerry is at a discount of 27.6% to its 12-month high of CAD18.14 on January 09. It is also at a premium of 23.2% to the 12-month low of CAD10.66 on August 21, 2017.

3.2 Aggregate Volumes and Prices:

[Volume Index or VI in brackets; 1 is average]

+ New York: BB.NYSE 2,018,400 [VI of 0.4] volume 61.79% of aggregate. Price: $US10.08.

+ Toronto: BB.TSX 1,248,195 [VI of 0.5] volume 38.21% of aggregate. Price: CAD13.13.

+ Aggregate volume: there were 3.3 million shares of BlackBerry worth CAD43.1 million traded today. The aggregate volume was 0.4 times average trading of 8 million shares.

The turnover rate in the 12 months to date was 103.3% (or a turnover period of 11 months). This average length of ownership of the stock at 0.5 times the average holding period of 2 years 37 days for stocks in the S&P/TSX 60 Index suggests a larger number of speculators on the share register, making it less safe for long-term investors.

3.3 Moving Annual Return (Past 5 years)

Based on a dynamic start date of 5 years ago, the Moving Annual Return has been positive in 3 of the last 5 years. An investment a year ago in BB would have produced a return of 18.8%.

BBClose (CAD)Annual Return %
Aug 1713.1318.8
1 Yr ago11.054.4
2 Yrs ago10.585.5
3 Yrs ago10.03(3.9)
4 Yrs ago10.44(3.9)

Close 5 years ago CAD10.86

3.4 Beta & Alpha:

+ Beta: the Beta of BlackBerry stock is 2.1. A Beta greater than 1 suggests this is a high risk, high return stock with volatility greater than that of the market.

+ Alpha: the Alpha of the stock is 7.1. The actual return of 21.78% exceeded the expected return of 14.7%, reflecting outperformance.

3.5 Year-To-Date

+ BlackBerry (TSX:BB), decreased 91.0c (or 6.5%) year-to-date (YTD) in 2018 to close at CAD13.13 today. Compared with the S&P/TSX 60 Index which has risen 1.7% YTD, this is a relative price change of -8.2%.

SECTION 4 BLACKBERRY RELATED NEWS

4.1 Corporate Wires

BlackBerry (BB) issued 1 new Release this week.

August 15: BlackBerry Again Recognized as a Leader in the 2018 IDC MarketScape EMM Report

WATERLOO, Ontario, Aug. 15, 2018 -- BlackBerry Limited (NYSE: BB; TSX: BB) today announced it has been positioned by IDC, as a 'Leader' within the IDC MarketScape: Worldwide Enterprise Mobility Management Software 2018 Vendor Assessmenti, which provides an in-depth analysis of worldwide enterprise mobility management (EMM) software providers.

To view the previous 3 months' Releases in full, click here

4.2 Other News

+ BSS/News Bites:

BlackBerry is placed 481/2048 in BSS News Bites' ranking of Canadian performers in the past year, a percentile ranking of 77.

+ Vanguard Total World Stock ETF 2588:

The stock was one of 2588 global stocks selected by Vanguard Total World Stock ETF (VT) who sold 165,832 shares in the period May 31, 2018 to Jun 30, 2018 worth $US-2,456,900 at an estimated Volume Weighted Average Price (VWAP) of $US14.8156. As at Jun 30, 2018, the Vanguard Total World Stock ETF held 0 shares worth $US0 or 165,832% by value of the ETF's portfolio [Ranked 2128 out of 2588 by value and 90 out of 103 for Canada].

SECTION 5 BLACKBERRY GLOBAL RANKING

Global Rank [out of 47,646 stocks] and Rank of BlackBerry in the American Region [out of 11,859 stocks]

DescriptionValueGlobal RankIn Am Region
MCap (US$)5.4B2,415966
Total Assets (US$)3.8B4,8591,814
Revenue (US$)932M7,0172,217
Net Profit (US$)405M2,175896
Return on Equity %16.26,7031,389
Net Profit Margin %43.52,394684
Price to Book6.131,2105,144
PV1000 (1Year) USD*1,15211,0553,488
US$* Change (1Year) %15.59,9493,111

* 1 year ago CAD 1 = USD 0.79

Aug 17, 2018: CAD 1 equals USD 0.76

SECTION 6 BLACKBERRY SUMMARY FINANCIALS

Financials Summary (Past 3 years)

Year endedFeb 2018Feb 2017Feb 2016
Sales (USD)932M1.3B2.2B
Pretax (USD)406M(1.2B)(282M)
Net (USD)405M(1.2B)(208M)
EPS (USD)0.76(2.3)(0.4)

+ There was a turnaround in Net profit from a loss of US$1.2 billion in 2017 to net profit of US$405 million in 2018.

+ Earnings Per Share (EPS) improved from a loss of $US2.30 to 76.0c.

SECTION 7 BLACKBERRY PROFILE

7.1 Activities

BlackBerry Ltd is a designer, manufacturer and marketer of wireless solutions for the mobile communications market.

7.2 Top Management

The chief executive officer is John Chen.

7.3 Issued Capital

Based on 537,105,846 issued shares the market capitalisation is CAD7.1 billion (US$5.4 billion).

COMPANY IDENTIFIERS

Contact: (519) 888-7465

Physical Address: 295 Phillip Street, Waterloo, ON, CA, N2L 3W8

State/Province/Country: Canada

Country of Incorporation: Canada

Exchange: Toronto Stock Exchange

Business Sector: Industrial Goods

Industry Group: Aerospace & Defense

Industry: Aerospace & Defense

Activity: Communication & Satellite Equipment

Economic Sector: Industrials

ISIN: CA09228F1036

T:BB; TSE:BB; N:BB; CN:BB; BB.TO

PermID: 4295861766

RIC: BB.TO

CIK: BlackBerry Limited (formerly Research In Motion Limited)

Blackberry Limited, Blackberry Ltd

Source: www.BuySellSignals.com