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Wednesday's analyst upgrades and downgrades Add to ...

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Inside the Market’s roundup of some of today’s key analyst actions

The Street reacted positively to Wednesday’s news BlackBerry Ltd. (BB-T, BBRY-Q) has been awarded $814.9-million in a binding interim arbitration decision in a dispute with Qualcomm Inc. over royalty overpayments.

The Waterloo, Ont.-based tech company was upgraded by a pair of equity analysts, while several others raised their target price for its stock.

Scotia Capital’s Paul Steep raised his recommendation to “sector outperform” from “sector perform” with a target price of $13.27, up from $10.71.

"We anticipate that if Blackberry is successful in achieving a final arbitration award from Qualcomm (approximately $815-million) then the firm will be extremely well positioned to undertake further M&A to accelerate its software-first strategy," he said. "Our expectation is that Blackberry’s capital deployment priorities would rank as: (1) M&A to accelerate software revenue growth; (2) share repurchases; and (3) selected repurchases of its convertible debentures. We believe that Blackberry’s focus will be primarily on deployed capital towards M&A in key business lines with longer-term growth opportunities (e.g. Internet of Things, security and secure communications.

“We expect BlackBerry’s results to remain volatile over F2018 as certain aspects of the business remain unclear: (1) revenue ramp from IP and device licensing, (2) normalized operating cost structure, and (3) additional metrics to evaluate the performance of the software business.”

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