Canadian tech shares had fun within the limelight in the course of the tech growth a number of years in the past, proper across the pandemic. The sector-wide meltdown led to many individuals stepping away from the tech sector to keep away from pointless capital threat. Nonetheless, many Canadian buyers noticed multi-fold returns by way of shares like Shopify.
Whereas that’s the identify that sometimes pops up when individuals consider Canadian tech shares, there’s one other that’s been round for longer and is likely to be making some large strikes. Most youthful individuals won’t know of it proper now, however BlackBerry (TSX:BB) was a giant identify again within the day.
This was the most important identify within the cellphone trade again after I was in highschool. Whereas the corporate’s smartphone enterprise light into obscurity some time in the past, BlackBerry isn’t down and out. As an alternative, it has change into one of many foremost firms offering safe communications and tech for autonomous automobiles.
Immediately, we are going to take one other take a look at this long-forgotten smartphone firm to see why it is likely to be a superb funding proper now.
BlackBerry
As issues stand now, BlackBerry is a Canadian tech firm that engages in offering clever safety software program and providers to governments and enterprises. The $3 billion market-cap agency headquartered in Waterloo leverages machine studying and synthetic intelligence to ship cybersecurity, security, and knowledge privateness options. It additionally presents options for endpoint safety and administration, encryption, and embedded programs.
It’s not the corporate that fizzled out when different smartphone producers out-innovated it. The corporate has taken the chance to supply the facility below the hood of smartphones as an alternative of creating the gadgets itself.
Whereas not as thrilling as competing to create the most effective telephones, the corporate’s enterprise is doing properly. The primary quarter of fiscal 2026 noticed the corporate report $121.7 million in income, beating steerage. The corporate’s adjusted earnings earlier than curiosity, taxes, depreciation, and amortization (EBITDA) additionally beat analyst expectations, coming in at $16.4 million.
Why it’s underperforming
Regardless of posting good numbers, the corporate’s share costs have been weak for a number of weeks. As of this writing, BlackBerry inventory trades for $5.03 per share, down by 43.23% from its 52-week excessive, and a far cry 97% from its 2007 all-time excessive valuation. Regardless of the enterprise being in higher form than it has been for a few years, the corporate is struggling towards the results of the tech sell-off. Traders have additionally misplaced religion within the firm attributable to its previous failures.
Lengthy-term buyers who’ve caught with BlackBerry inventory know that the share costs don’t mirror its inherent worth. Regardless of a clear steadiness sheet, publicity to high-growth market segments, and constant profitability, investor fatigue has saved its share costs down.
Silly takeaway
The enterprise is doing properly. The current quarter noticed the corporate finish with $381.9 million in whole money and investments, a giant enchancment from $235.7 million in debt. The additional money in comparison with its debt allowed BlackBerry to purchase again 2.6 million shares. Regardless of share buybacks indicating that the corporate believes its inventory is undervalued, it isn’t a risk-free funding. The tech area is continually altering, and BlackBerry should be sure it stays related. All issues thought of, BlackBerry inventory won’t be an apparent successful decide, however it isn’t a misplaced trigger. The corporate’s margins are enhancing, and it’s worthwhile. It may be a superb contrarian decide to contemplate to your self-directed portfolio in the event you can abdomen the danger.
