What follows is an excerpt from Canaccord Genuity’s Morning Coffee newsletter.
Last week, BlackBerry’s (
TSX: T.BB,
Stock Forum) board of directors announced it has formed a special committee to explore strategic alternatives such as joint venture strategic partnerships, or a sale of Blackberry to enhance the company’s value and increase scale to accelerate Blackberry 10 deployment.
While Blackberry announced in May 2012 it hired Wall Street and Bay Street bankers to review strategic options, it appears the board of directors will focus on strategic alternatives following what Canaccord Genuity analyst Mike Walkley believes are disappointing Blackberry 10 sales.
Given Walkley’s cautious BB190 sales outlook and his belief that Blackberry’s subscriber base and services (average revenue per user) ARPU will continue to decline over the next several quarters and years, Walkley struggles to identify potential buyers that would pay a premium to the current share price.
Blackberry shares fell 1% Monday to $10.75, leaving the company with a market cap of $5.6 billion, based on 524.2 million shares outstanding. The 52-week range is $18.49 and $6.10.