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On Thursday, RBC Capital Markets adjusted its outlook on BlackBerry Limited (NYSE:BB), reducing the price target to $3.75 from the previous $4.00, as the stock currently trades at $3.19 with a market capitalization of $1.87 billion. The firm maintained its Sector Perform rating on the company’s stock. This revision comes in light of concerns about the company’s financial guidance for fiscal year 2026 and the potential impact of external factors on its revenue streams. According to InvestingPro data, BlackBerry has experienced a significant 14.4% decline in the past week alone.
BlackBerry Limited recently reported its fourth-quarter earnings, which surpassed consensus estimates, though InvestingPro analysis shows the company’s revenue declined by 15.7% in the last twelve months. The company’s guidance for fiscal year 2026 did not meet analysts’ expectations. RBC Capital highlighted that uncertainties, including those related to tariffs, could postpone new programs at automotive OEMs. This delay is expected to have a negative effect on the growth of BlackBerry’s QNX revenue, particularly concerning given the company’s current WEAK Financial Health Score.
Additionally, RBC Capital noted that potential government elections and changes could serve as a headwind to the growth of BlackBerry’s Secure Communications division. These political factors could influence the company’s performance and its ability to expand within its market.
Despite these challenges, RBC Capital has chosen to maintain its Sector Perform rating, indicating a neutral outlook on the stock. The firm suggests that the valuation and estimates for BlackBerry are being recalibrated to reflect the company’s growth and profitability trajectory after the divestiture of Cylance, its cybersecurity unit.
The new price target of $3.75 represents RBC Capital’s adjusted expectations for BlackBerry’s stock value, taking into account the various factors that could influence the company’s financial health and market position in the coming years. While currently trading slightly below its Fair Value, investors seeking deeper insights can access comprehensive analysis and 8 additional ProTips through InvestingPro’s detailed research reports, available for over 1,400 US stocks.
In other recent news, BlackBerry Limited reported fourth-quarter results that exceeded expectations, with adjusted earnings per share of $0.03 surpassing analyst estimates of $0.02. The company also reported revenue of $141.7 million, which beat the consensus forecast of $132.2 million. Despite these positive results, BlackBerry provided a weaker-than-expected outlook for the upcoming fiscal year, projecting first-quarter revenue between $107 million and $115 million, below the analyst consensus of $128.4 million. For the full fiscal year 2026, BlackBerry expects revenue in the range of $504 million to $534 million, which is also below the Street’s estimate of $550.6 million.
Additionally, Canaccord Genuity adjusted its price target for BlackBerry shares to $4.25 from $4.75, maintaining a Hold rating. This adjustment reflects the company’s current business outlook and market conditions, despite the company’s improved operational performance and potential for growth. BlackBerry’s QNX division showed a 6% sequential revenue growth to $65.8 million, and Secure Communications revenue exceeded guidance at $67.3 million. The company’s cash position also improved significantly, with total cash and investments increasing by $144 million, partly due to the sale of Cylance to Arctic Wolf.
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