Business & Investment

Reddit users went down and BlackBerry (TSX: BB) stock price soared

Over the last 7 days, we’ve seen stubborn moves from Reddit users on subreddit r / WallStreet Bets.The target was a less popular stock BlackBerry (TSX: BB)(NYSE: BB) And Gamestop.. This was one of the rare moments when individual investors began to move stock prices. It is generally hedge funds that drive the market.

WallStreetBets created a sensation overnight and discussed the two strains in detail. As a result, BlackBerry shares have risen about 30-38% in two of the last four days of trading, almost doubling during this time.

Is BlackBerry’s stock price rise justified?

Some analysts sought to justify the rally as the long-awaited momentum for stocks. Hedge fund investors have been unable to buy shares due to their surplus history and multiple years of declining earnings. But how do you describe today’s depression? When Robin Hood restricted users from buying or trading BlackBerry shares, the shares suddenly fell by more than 40%. In addition, Discord has banned the r / WallStreetBets server. report The Verge..

A few days ago I Raise suspicion How to justify the rise in BlackBerry stock prices and the surge in both technical and fundamentals. At least BlackBerry executives should know for the underlying reason. Its chief marketing officer, Mark Wilson, and CFO Stevery would not have sold a significant amount of their stock.

Stock prices determine a company’s potential to grow on revenue, revenue, or cash flow.Even if you say it Facebook The reason for the rally is a patent infringement settlement, but has BlackBerry received millions or billions of dollars in settlement money?

Then there was another positive new place Amazon Web services enhance BlackBerry’s Intelligent Vehicle Data Platform (IVY). We agree that this partnership will give BlackBerry the momentum of electric vehicles (EVs), but it won’t grow revenue immediately. BlackBerry needs to secure key contracts from the EV supply chain to increase revenue.

For stocks to move 30% in a day, the news should reflect significant earnings growth over the next 12 months.When Shopify Stock prices soared during the pandemic, supported by more than 95% earnings growth.

It’s clear that the rise in BlackBerry stock was driven by new investors enjoying free trading on the Robinhood app. Today, Robin Hood allows users to close existing positions, but shares have fallen as they limit the purchase of further shares.

How can I make money with BlackBerry stock?

I warned not to buy before BlackBerry stock of this rally. A rally that is not backed by fundamentals is gambling. This does not mean that BlackBerry is not in good stock. There is strong growth potential in 2030. BlackBerry is the second largest holding of billionaire investor Prem Watsa. Motley Fool also recommends BlackBerry.

BlackBerry brings endpoint security software and services to mobile, laptop, automotive and other Internet of Things devices. In 2019, the company reported its first 20% revenue growth since migrating to software. However, the pandemic turned to a decline in earnings in 2020, overturning earnings growth as car production was hit. In 2021, demand for EVs, which drive revenue, will stagnate.

Investor takeaway

It is important to buy the stock at the right price. Stock prices of $ 10 to $ 15 are sustainable because of the average trading price over the last three years. If you buy a stock for a price less than $ 10, we will sell it while it is trading over $ 15. If you don’t own the stock, wait bystanders until the end of this frenzy and buy it when the stock falls below $ 14.

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John Mackey, CEO of Whole Foods Market, a subsidiary of Amazon, is a member of The Motley Fool’s Board of Directors. Randi Zuckerberg, a former Facebook market development director and spokeswoman and sister to CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors.Stupid contributor Puja Tayal There are no positions in any of the listed stocks. David Gardner I own shares in Amazon and Facebook. Tom Gardner I own shares in Facebook and Shopify. Motley Fool owns and recommends shares in Amazon, Facebook, Shopify, and Shopify. Motley Fool recommends BlackBerry and BlackBerry and recommends the following options: A long call of $ 1920 in January 2022 on Amazon and a short call of $ 1940 in January 2022 on Amazon.

Reddit users went down and BlackBerry (TSX: BB) stock price soared Reddit users went down and BlackBerry (TSX: BB) stock price soared

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