This article was first published on www.iknowfirst.com
Blackberry Stock Forecast
- Blackberry is expanding their mobile phone security to non-Blackberry devices via their acquisition of Good Technology.
- Their software and service security operations are expanding faster than ever which is prominently highlighted via their acquisition of AtHoc.
- Blackberry are keen to capitalise on the forthcoming Internet of Things security nightmare.
The recent leaks reporting the impending launch of an android-run Blackberry this Fall has been hailed as a last-ditch attempt for Blackberry (BBRY) to regain some lost ground in the mobile phone market. The new “Blackberry Venice” will run on the Android OS operating system that already dominates the mobile phone market and will have a host of built-in apps that are ordinarily reserved for android phones. By supplementing Android’s successful operating system with Blackberry’s superior security, they hope to fill in a void in the mobile phone market. I believe the Venice phone will help Blackberry gain some much needed traction in the mobile phone market, however, even if Venice not a success, demand for Blackberry’s products will increase in the future.
As alluded to above, Blackberry’s superior security is their trump card in the communications industry. Safety, reliability and security are hallmark strengths of BlackBerry Enterprise products and services, and have been instrumental to growth in highly secure and regulated industries such as healthcare, government and financial services.
Mobile phone users are becoming increasingly security conscious concerning sending personal and private information both over the web and through mobile communications. Most recently exemplified by the Ashley Madison hacking saga, security is legitimately becoming a paramount concern amongst internet and mobile phone users.
Keen on reinforcing their quantitative security edge, Blackberry acquired rival mobile security provider Good Technology Corp last week. Good Technology specialises in managing and securing mobile devices and apps both for businesses and individual customers.
The $425 million deal cements Blackberry’s position of being the crème de la crème in secure mobile communications. Over the years Good Technology has been stealthily stealing Blackberry’s clients by allowing employees to access their company’s platform on any mobile phone – be it an Apple (APPL) iPhone or an Android. The company’s has been highly successfully and is held in great esteem, counting all of the G7 governments and the world’s ten largest banks and law firms amongst its customers.
By merging the two company’s clientele, Blackberry has successfully eliminated a key obstacle in the company’s path to future growth and cost-saving synergies are undoubtedly inevitable. By acquiring Good Technology, Blackberry is effectively saying, “Go ahead, use any device you want. We’ll secure it for you.” Even if mobile-phone users do not use a Blackberry device, Blackberry are able to, and still want to, safely secure it. Thereby causing their company name to become synonymous with mobile security.
Not Just About Devices
Blackberries products do not revolve around mobile devices. Indeed, over the past one and a half years revenue form hardware has drastically decreased whereas revenue from software and services increased accordingly.
Back in July, Blackberry secured a deal to purchase AtHoc whose customers include the Department of Homeland Security and the US Department of Defence. AtHoc’s communication software is essentially a messaging alerts system but for entities that need to exchange important and sensitive information when other forms of communication is not deemed secure enough. The financial terms of the deal were undisclosed but the acquisition means Blackberry will now provide security for 200 airports.
The Transportation Security Administration (TSA), which employs AtHoc, believes that Blackberry’s acquisition will increase coverage capabilities and improve emergency and critical handling at big airports such as SFO, LAZ and JFK.
The TSA evidently believe that Blackberry software is both reliable and secure enough to utilise in times of crisis like weather-related closures or ongoing terrorist activity. The purchase also highlights the manner in which Blackberry continues to cater its platform towards regulated and government agencies.
Blackberry clearly stand to benefit from absorbing AtHoc’s prestigious clientele, but AtHoc’s software will also be significantly boosted by merging with Blackberry’s BBM messenger. Blackberry’s revenues are now predominantly from software and services and now that they are venturing a return into the mobile-phone market they are not refocusing their software operations on a bigger mobile-phone market. On the contrary, seem to matching their efforts to expand their phone market with larger and potentially more lucrative efforts to expand their service and software segments.
Internet of Things
The Internet of Things (IoT) is the network of physical objects via data and allows these physical objects to be controlled remotely across existing network infrastructure. The integration of the physical world with computer-based systems and networks results in greater efficiency, impeccable accuracy and is therefore of great economic importance. The Internet of Things is starting to play a significant role in our lives and is considered to be one of the next big-thing in technology, according to experts, IoT will consist of 50 billion objects by 2020 and Blackberry seem keen to capitalise on this new market.
Blackberry’s acquisition of AtHoc exemplifies how the company are determined in securing themselves a big market share in both the security and privacy of the Internet of Things. Similarly, back in April, Blackberry’s subsidiary company, Certicom, started to hand out security certificates to device producers and service providers that are seeking to connect their devices and networks to the IoT. Subsequently, Certicom won a lucrative contract to use its security certificates in approximately 104 million smart meters and energy management devices in the United Kingdom.
Blackberry’s newfound focus on the Internet of Things security market may be the smartest move the company has taken yet. Technology companies are demanding security options for Internet of Things products more than ever and Blackberry are offering the right products at the right time. Indeed, last year Hewlett-Packard released a report highlighting security issues within the IoT claimed that 70% of IoT home devices use unencrypted network services and 80% have serious security flaws. Internet of Things security is deemed so important that even Congress openly voiced its concern at lack of protection IoT products have. These concerns were echoed by Intel’s then CTO for security Michael Fey who said last year that. “Security needs to be built in as the foundation of the Internet of Things. Any disruption to these IP connected devices can cause damage to the business and our daily lives”.
Blackberry have therefore chosen the most opportune time to delve into the market. Their Certicom certificates will enable companies to authenticate and secure devices that manufactures create, thereby allowing companies to focus on building projects instead of constantly stressing themselves with securing them.
Blackberry Stock Forecast-Algorithmic Analysis
I Know First supplies financial services, mainly through stock forecasts via theirpredictive algorithm. The algorithm incorporates a 15-year database, and utilizes it to predict the flow of money across 2000 markets. The self-learning algorithm uses artificial intelligence, predictive models based on artificial neural networks, and genetic algorithms to predict money movements within various markets.
The algorithm produces a forecast with a signal and a predictability indicator. The signal is the number in the middle of the box. The predictability is the number at the bottom of the box. At the top, a specific asset is identified. This format is consistent across all predictions. The middle number is indicative of strength and direction, not a price target. The bottom number, the predictability, signifies a confidence level.
I Know First has had success predicting the behavior of Blackberry’s stock performance in the past. This 7-day “Stocks Under 10 Dollars” forecast from August 24th included Blackberry in the top 10 stocks for the long position. It had a signal strength of 24.26, and the stock price increased 6.15% during the predicted time period as the algorithm predicted.
More recently, I Know First published a bullish forecast on Blackberry, a Canadian telecommunication and wireless equipment company, on Seeking Alpha. Having explained how I Know First’s algorithm works, it is worthwhile to see if the algorithm agrees with the bullish fundamental analysis of the company. The one-month, three-month and one-year forecasts for Blackberry are included.
(I Know First Forecast from 3rd September ’15)
Blackberry is among the top stock picks for ball three time horizons. The stock has a strong, bullish signal thoughout an is consistently amongst the algorithm’s top five tech-stock picks, indicating that the stock is currently very undervalued. Over the predicted time horizons, the stock is currently undervalued, which is in support of the fundamental analysis. The Canadian company are set to introduce a new Android powered phone, creating lucrative security contracts and making big inroads into the Internet of Things market.
Positive signal strength does not mean investors should automatically buy the stock. Dr. Roitman, who created the algorithm, created rules for entry for a stock such as BlackBerry. Using this trading strategy, an investor should buy a stock if the last 5 signal strength’s average is positive and if the last closing price is above the 5-day moving average price. When both of these conditions are met, it is a good time to initiate a position in the stock.
The new android operated Blackberry phone could be a bit of a wild card. Even though androids are highly respected and extremely popular, Blackberry have not had much success in the phone market for years now and if that was the only factor dictating upside potential on Blackberry stock then I would advise investing conservatively. However, their security contracts and their willingness to secure non-Blackberry mobiles through their acquisition of Good Technology, is indicative of the huge potential Blackberry has in growing their already large mobile phone security operations. Likewise, their security software and their Internet of Things security operations are highly respected and growing at a very fast rate. Their growing market share in both those industries compensate for the plunge the company took in the mobile phone market and point to a promising future for Blackberry.
My inspiration for analysing Blackberry stock came form I Know First’s highly bullish algorithmic analysis. BBRY is amongst the algorithm’s top-five stock picks for all the forecasted timeframes within the next year and reflects the bullish fundamental analysis for Blackberry currently circulating around the financial world. The Venice phone may see some success but I would invest in Blackberry purely for their strong positions in the security software, services and the Internet of Things market.