BlackBerry Upgraded On Huge Cash Pile

By Jennifer BootonMarketWatch Pulse

BlackBerry Ltd. was upgraded to equal-weight from underweight at Morgan Stanley on Tuesday under the premise that cash flexibility and cost-cutting initiatives will drive stock-price value in the near term. However, the bank maintained its 12-month price target of $7, saying there is still no evidence of a "fundamental business turnaround." Shares of BlackBerry were up 1.9% to $7.42 in premarket trade. Morgan Stanley estimates that BlackBerry's cash balance is worth roughly $3.50 to $3.75 a share, or more than half its current share-price value. The company has been moving more into software and focusing less on its legacy smartphone business amid intense competition from much larger smartphone rivals, particularly Samsung Electronics and Apple Inc. . BlackBerry has been on quite the losing streak, having missed quarterly sales expectations in 19 of the last 22 quarters, dating back to the fourth quarter of 2010.

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