Why the QNX Hailo-8 announcement matters for BlackBerry stock
BlackBerry (TSX:BB) drew fresh attention after its QNX division expanded support for the Hailo-8 AI Accelerator, targeting AI workloads in robotics, vehicles, and industrial systems and sparking a shift in retail sentiment.
The Hailo-8 news lands after a sharp move in BlackBerry’s share price, which is now at CA$11.97 and has a 1 day share price return of 10.83%. Despite a 3 month share price return that declined 3.16%, momentum has been strong this year with a year to date share price return of 129.31% and a 1 year total shareholder return of 127.57%, while the 5 year total shareholder return declined 15.23%. This shows recent enthusiasm is building off a much weaker longer term record.
Scan how BlackBerry compares with other AI and robotics plays by reviewing our hand picked 4 AI small caps.After a CA$11.97 share price and a year to date return above 100%, investors in BlackBerry now face a simple tension. Is the recent QNX and AI excitement mostly reflected in the stock already, or is there still meaningful upside ahead on valuation grounds?
Most Popular Narrative: 26.2% Undervalued
The most followed narrative on BlackBerry puts fair value at CA$16.22, above the current CA$11.97 share price, and anchors that view in QNX and physical AI royalties.
The market is pricing BlackBerry as a maturing automotive software company. What it actually has is the safety infrastructure layer that physical AI cannot be commercially deployed without. The automotive royalty backlog took fifteen years to reach $950M. The physical AI backlog is starting from zero right now, in a faster-growing market, with the same royalty model and the same impossibility of removal once embedded.
Read the complete narrative. Read the complete narrative.
Want to see why this narrative stretches fair value well past the current share price? It leans heavily on accelerating earnings, widening margins, and a rich future earnings multiple. Curious which long dated contracts and growth assumptions sit behind that conclusion? The full narrative spells out the numbers and how they tie back to BlackBerry today.
Result: Fair Value of CA$16.22 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, BlackBerry investors still need to weigh real risks, such as a sharp slowdown in auto production or slower than expected uptake for physical AI deployments.
Find out about the key risks to this BlackBerry narrative.
Another view on BlackBerry’s valuation
The user narrative pins BlackBerry’s fair value at CA$16.22, yet the current P/E of 84.7x is well above both the North American software industry at 32.8x and peers at 57.7x. It is also higher than a fair ratio of 32.1x. That gap points to real valuation risk if expectations cool.
See what the numbers say about this price, find out in our valuation breakdown. See what the numbers say about this price — find out in our valuation breakdown.
Next Steps
Given the mixed sentiment around BlackBerry, now is a good time to check the numbers for yourself and form your own view. To see how both the upside and the downside stack up in one place, review the 2 key rewards and 1 important warning sign.
Looking for more investment ideas beyond BlackBerry?
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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