BBRY: 2014 Stock of the Year
Blackberry (NASDAQ:BBRY) is our turnaround stock for 2014, this was revealed in December 2013 in our comprehensive market forecast for Calendar 2014, and recently the stock has come into play. We believe it is compelling, but aside from recent hype management also appears to have stabilized and that was the most crucial part to our identification of BBRY as the turnaround story of 2014. The year is not over, and we still support our observation.
Recently, news has surfaced supporting demand for Blackberry products in addition to other possibly much more compelling prospects that no one thought of last year. Blackberry's messaging app has suddenly come into play given what Facebook (NASDAQ:FB) has done with Whatsap. For those who pay attention to Blackberry, we know that they held talks with Facebook last year.
Obviously, we know that Facebook did not choose to buy Blackberry, but anyone who did buy Blackberry on the heels of that late year debacle last year is happy that they did. Given the changes that are taking place now we believe that the stock has the fundamental basis it needs to continue to increase, institutional investors seem to be back, and anyone who was given the opportunity to buy Blackberry at $9.00 last year when Fairfax was shopping it around is second guessing their decision.
Additionally, I went on record in January after the stock went on a tear suggesting that it could stall before continuing to move higher. That stall happened, the stock has since stabilized and regained ground, and now it is approaching an important inflection level according to our real time report.
The trading report offered by Stock Traders Daily pinpoints resistance at levels not significantly higher than Blackberry's current price, but in addition that report also proves that the stock never actually fell all the way to longer term support levels. Anyone schooled in technical analysis recognizes that consecutive tests of longer-term resistance levels without retracements to support in between often lead to breakouts.
By rule, we should never expect a stock to breakout until such time as it does, but our entry levels for Blackberry are significantly lower than the current stock price, and I see no reason for any of our clients to dissolve their position. New buy signals are not surfacing in Blackberry at this immediate moment, but if the stock breaks above longer term resistance as that is identified in our real time trading report for Blackberry, they will. By rule, we are buyers when resistance levels break higher.