5 reasons to add BlackBerry Ltd. (NASDAQ:BBRY) stock to your portfolio

Since the beginning of the year, when there were rumors that Samsung was on the verge of making an offer to acquire the fledgling tech firm, investors have been waiting for CEO John Chen to sell BlackBerry Ltd. (NASDAQ:BBRY), (TSE:BB). They may have to wait longer.

In a recent interview with the CBC, Chen promised that he has no intentions of selling the once dominant smartphone maker. However, he didn’t immediately dismiss the idea entirely, citing an increase in market value would be a potential agreement to be acquired.

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“I don’t have any intention to sell BlackBerry. Not until the BlackBerry shareholder has good value reflecting truly what we have,” said Chen. “Then, if there is a potential proper suitor that would take care of our customers … I have a fiduciary responsibility to listen. But until then, there’s no point in listening.”

Remarkably, Chen has turned BlackBerry around since entering the company in 2013. Although he hasn’t done much for the stock – it’s down 85 percent from 2011 when it was trading at $65 per share – the brand itself has significantly improved. Indeed, it is still in the smartphone market, but it has become a lot more than that.

In an attempt to salvage the wreckage from the company’s predecessor, Thorsten Heins, BlackBerry has delved into a wide variety of areas, including software security, healthcare-centric browsers and Android operating systems.

Despite the attempts of rejuvenation, a bulk of investors are still cautious about purchasing shares of BlackBerry. This is why it’s such a divisive stock in both the United States and in Canada. One group says it’s a lost cause, while another segment of investors says it’s a great opportunity to be a part of the turnaround process.

Unsure what to do? Here are five reasons why you should add BlackBerry to your stock portfolio, even if it’s just a few shares.

John Chen’s Determination to Increase Market Value

In January, Chen assured Canadian Industry Minister James Moore that rumors of Samsung wanting to acquire BlackBerry for $7.5 billion was just rumors. Chen noted, however, that if the rumors were true then he’d still reject the offer because he believes it to be too low. It was suggested Samsung wanted to buy BlackBerry for $15 per share. Essentially, Chen thinks he can get BlackBerry beyond $15 per share.

Moreover, it has been learned that BlackBerry has rejected multiple buyout offers. Chen could have taken the easy road in the past year if he wanted to, simply for the patents (see below).

BlackBerry Taps Former Cisco Exec to Boost Global Sales

The Waterloo, Ontario-based company announced last week it named Carl Wiese, Cisco Systems sales veteran, as its new head of global sales. In an initiative to enhance its device-management software, Wiese’s main goal is to improve sales in foreign markets. He takes over from John Sims.

BlackBerry is maintaining a $500 million target in management-device software and security services sales for fiscal 2016.

Its Immense Portfolio of Patents

The joke on Wall Street is: why would any company waste their money buying BlackBerry? Well, any business that purchases BlackBerry will also have a treasure trove of patents, particularly in security, that are still lucrative today.

On a global scale, the company has more than 44,000 patents. Here is what Bloomberg wrote:

“The company has a combination of older patents on the basic functioning of a mobile phone, as well as newer ones on security and on consumer-friendly features such as predictive typing on a keyboard or setting up meeting schedules.”

So let’s say Samsung purchases BlackBerry, it can gain entrance into the realm of government contracts and corporate clients. Moreover, it could somewhat minimize its patent dispute with Apple. Of course, Samsung is just one example of a firm that could purchase BlackBerry in the near future.

Large Number of Niches and Deals as of Late

This past month, BlackBerry scored an exponential licensing deal with Cisco Systems as well as a smartphone deal with Google. Last year, it signed a deal with Amazon to offer 240,000 Android apps to the BlackBerry. In December, it launched a secure cancer genome browser with NantHealth. For a company that has collapsed in the last 10 years, it is still garnering a plethora of both deals and opportunities.

$10 is Perhaps a Bargain

In the U.S., BlackBerry is trading around the $8 mark. In Canada, it’s been hovering around the $10 threshold. Whatever the case, many investors say it’s a bargain considering it’s potential room for growth. Many purport it’s not worth it because it doesn’t even have a five percent market share in anything. But those who are buying the stock have a tremendous amount of faith in Chen.

Essentially, BlackBerry could be a long-term bet, that is until a company eventually buys it out.

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Final Thoughts

Year-to-date, BlackBerry is down 20 percent. It doesn’t pay dividends. Goldman Sachs gave it a “sell” rating. To any passive observers, there isn’t any upside to BlackBerry. But once you start scratching beneath the surface, there are numerous positives to the stock. It isn’t easy to provide an answer to the question: will it shoot up to $25 a share in a couple of years? You could come to that conclusion if you perform your own due diligence, and perhaps share it with the rest of the world.

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