BlackBerry Ltd (NASDAQ:BBRY) announced a share buyback plan for up to 12 million shares. Currently, the mobile company has roughly 529.5 million common stock shares outstanding. 464.7 million Shares are currently owned by public stockholders.
The buyback will take up 2.5% of the shares that are in the hands of public investors. The firm maintains that the buyback plan is a strategy to provide a counterbalance to the dilution from employee stock plans. The co-portfolio manager of the Action Alerts PLUS, Jim Cramer warned investors against putting their trust on the Canadian company’s stock.
Mr. Cramer’s analysis of the mobile company revealed some wanting conditions. Blackberry hardware sales in the 2015 financial years were unattractive. The firm sold 1.1 million units compared to 2.6 million devices sold in the previous year. He added that giving up on the stock is not should not be the last solution because the company’s hardware division is still worth fixing. Selling it is also an option.
The company’s software division was doing better, and recent surveys show that there has been constant growth. Analysts are however skeptical about the consistency of the growth curve in the future. Blackberry is rather shy about disclosing its revenue figures. When the company’s CEO, John Chen was asked whether he considers offering the firm up for an acquisition, he declined strongly.
BlackBerry Ltd (NASDAQ:BBRY) did not score well on TheStreet Ratings. The team that gave the mobile company as rating score of D said there were a few negative factors riding on the unattractive rating. These factors could limit the investors’ chances of making gains from the shares. Additionally, the firm has weaknesses in multiple areas, making it even harder to sustain profits. The share repurchase program will be initiated on June 28, 2016, and will run for 12 months. Blackberry shares have ranged between $8.59 and $12.63 in the past year. The company’s shares went up by 2 cents to $8.85 before market trading. In January, the firm’s shares were at a 52-week high while they are now almost at their lowest.
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