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Blackberry Stock Continues to Plummet

November 27, 2013 | About:
Muhammad Bazil

Muhammad Bazil

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The handheld devices in which people are attached are ever evolving. BlackBerry Limited (BBRY) emerged as a new fashion, but the device has shown to be more of a fading fad then a lasting technological advance in communication equipment. Many attribute the lack of popularity to the more complex nature of the phone’s operation. However, it would appear that the stock was doomed for failure from the start, and like a plagued vessel many have jumped ship.

Upon first glance, an investor may see that BBRY is in an incline, and there is no doubt that the stock will continue to rise slowly being that it is scrapping the bottom of the barrel in terms of value. It should not be expected that BBRY will survive long enough for an investment to be prosperous. One need only to look at the stock from 1999 until now. Apart from a brief increase from late 2007 to mid-2008, it has done nothing but fall.CNN money shows that from 2008 to 2010 the stock fell 75.38%. Then the 25% that did not fall during this time has decreased by 61.94%. Clearly, this stock is close to its end.

Those which have stock with BBRY are urged to sell and sell quickly. BBRY has announced that BlackBerry is open for bids, stating that it will sell the company for $4.6 billion. This should not come as a shock to investors that have kept a keen eye on the market. One will find that BlackBerry has had several legal issues which have resulted in a substantial financial loss on the already bleak company. As recently as October 2013, BBRY has been sued for allegedly “propping up stocks with false claims.” This is by no means the first time this company has seen legal actions taken regarding its honesty with stocks and finances.

With shares selling for $6.33 compared to Apple (APPL) at $534.74, it is plain to see that holding or acquiring additional shares would be costly at best. Could a merger help? Possibly, but from the history that BBRY has shown one would be inclined to think otherwise. One needs also to consider the legal entanglements that the company has been involved in constantly. With a company value of only $5 million, it would only take one major suit to completely destroy what is left of the company’s finances.

Potential investors are warned to stay clear. Due to the announcement in August to sell, the lack of BlackBerry sales, and the ever declining slope of the financial worth of the company, it is a reasonable deduction to believe that BBRY if it survives will be reduced to a little more than a penny stock. This is the most optimistic outcome and therefore should be an indicator of the dangers posed in investing here. The more predictable outcome will be that BBRY will fade out like an old fad (for that is what it is) and the company’s technology will be acquired by a competing company. As of yet, no major bids have been released to the public. An investor should take this as a red flag that BBRY may be left to its own demise.

BlackBerry is a dangerous investment from any perspective. For the investor, the company is on the downward slope, so acquiring any financial profits from the investment may be difficult. An investor may make a slightly better sell should they hold the stock for a few days, but one is not advised to hold this stock for too long. Buyers, investing in a stock that has shown very little increase as well as intent to sell would be a poor choice of portfolio interests. Another red flag would be the possibility of BBRY being dishonest with its shareholders. A company that cannot be trusted to give truthful information is a company that needs to be avoided. If interested in joining the technology market one is advised to look at the top competitors of BBRY and invest accordingly.

About the author:

Muhammad Bazil
Muhammad Bazil is a financial journalist and editor for a variety of websites, public policy organizations, and book publishers. He has written hundreds of published articles and blog posts on topics including budgeting, credit management, real estate and investing. His articles have been featured on the homepage of Yahoo!, MSN and numerous local news websites.

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