Will BlackBerry See Its Stock Move Higher After Recent Headlines?

With shares of BlackBerry (NASDAQ:BBRY) trading around $8, is BBRY an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

BlackBerry is a designer, manufacturer, and marketer of wireless solutions for the worldwide mobile communications market. Through the development of integrated hardware, software, and services it provides platforms and solutions for seamless access to information such as email, voice, instant messaging, SMS, Internet, intranet-based applications, and browsing. Its products and services feature the BlackBerry wireless solution, the Research In Motion Wireless Handheld product line, the BlackBerry PlayBook tablet, software development tools, and other software and hardware.

BlackBerry named Eric Johnson to its top sales job, hiring one of Chief Executive Officer John Chen's former colleagues to help the smartphone maker regain the confidence of customers. Johnson is coming to BlackBerry from SAP AG (NYSE:SAP), where he was a senior vice president in charge of the company's global database and technology, according to a statement today. Johnson and Chen both joined SAP when it acquired their previous company, Sybase Inc., in 2010. Chen is reassembling much of the old team that helped him turn around Sybase's fortunes, a feat he's attempting to repeat at BlackBerry, which has lost market share to Apple Inc. and Samsung Electronics. In December, Chen appointed Mark Wilson, a former Sybase executive, to lead marketing, and he hired John Sims from SAP to take charge of the enterprise business. "The experience that the majority of the new leadership team has in working together previously will drive change within the organization at a faster pace," Chen said in the statement. "I look forward to demonstrating these changes to the market."

T = Technicals on the Stock Chart Are Mixed

BlackBerry stock has struggled to make positive progress in the last several years. The stock is currently pulling back and may need time to consolidate before heading higher. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, BlackBerry is trading between its rising key averages, which signal neutral price action in the near-term.

(Source: Thinkorswim)

Taking a look at the implied volatility (red) and implied volatility skew levels of BlackBerry options may help determine if investors are bullish, neutral, or bearish.

	Implied Volatility (IV)	30-Day IV Percentile	90-Day IV Percentile
BlackBerry options	64.63%	20%	18%

What does this mean? This means that investors or traders are buying a minimal amount of call and put options contracts, as compared to the last 30 and 90 trading days.

	Put IV Skew	Call IV Skew
February Options	Average	Average
March Options	Average	Average

As of today, there is an average demand from call and put buyers or sellers, all neutral over the next two months. To summarize, investors are buying a minimal amount of call and put option contracts and are leaning neutral over the next two months.

On the next page, let’s take a look at the earnings and revenue growth rates and the conclusion.

E = Earnings Are Mixed Quarter-Over-Quarter

Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on BlackBerry’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for BlackBerry look like and more importantly, how did the markets like these numbers?

	2013 Q3	2013 Q2	2013 Q1	2012 Q4
Earnings Growth (Y-O-Y)	-41,950%	-308.89%	83.84%	178.41%
Revenue Growth (Y-O-Y)	-56.25%	-45.02%	9.37%	-35.97%
Earnings Reaction	15.51%	1.00%	-27.76%	-0.82%

BlackBerry has seen mixed earnings and decreasing revenue figures over the last four quarters. From these numbers, the markets have been optimistic about BlackBerry’s recent earnings announcements.

P = Excellent Relative Performance Versus Peers and Sector

How has BlackBerry stock done relative to its peers, Apple (NASDAQ:AAPL), Google (NASDAQ:GOOG), Nokia (NYSE:NOK), and sector?

	BlackBerry	Apple	Google	Nokia	Sector
Year-to-Date Return	12.90%	-3.96%	1.15%	-1.17%	3.23%

BlackBerry has been a relative performance leader, year-to-date.

Conclusion

BlackBerry provides innovative wireless communication products to consumers and companies worldwide. The company named Eric Johnson to its top sales job, hiring one of Chief Executive Officer John Chen's former colleagues to help the smartphone maker regain the confidence of customers. The stock has not done well in recent years and is currently pulling back. Over the last four quarters, earnings have been mixed while revenues have been decreasing, which has left investors optimistic. Relative to its peers and sector, BlackBerry has been a relative year-to-date performance leader. WAIT AND SEE what BlackBerry does this quarter.