What Do Hedge Funds Think About BlackBerry Ltd (BBRY)?

Is BlackBerry Ltd (NASDAQ:BBRY) coming back as one of the leaders in the smartphone market? The short answer is no; or at least, not yet. The company’s latest financial results for the third quarter of fiscal 2015 showed a decrease in revenues to $793 million, from $1.19 billion a year ago, but its GAAP net loss narrowed significantly to $0.28 from $8.37. However, the decrease in revenue was mainly impacted by a drop in handsets delivered last year. The company sold around 5.9 million phones in 2014, which represents a decline of around 70%. Therefore, BlackBerry is still losing ground in terms of market share. According to IDC data, BlackBerry OS’s market share was at just 0.5% in the third quarter of 2014, a significant drop from 9.6% in 2011.

However, there are some positive signs that could bring BlackBerry back on track. The company has released two new smartphones in the second half of 2014, the Passport and Classic. However, both models have been released in limited editions and without any tie-ups with carriers in the US. In this way, both new models, which represent attempts by BlackBerry to revitalize smartphones with physical keyboards, still require some time to have an effect on BlackBerry’s sales figures. Moreover, it also looks like hardware is not the primary focus of the company anymore as CEO John Chen is engaging more in the development and sale of security software to governments and other companies.

On the other hand, investors seem pretty confident about BlackBerry Ltd (NASDAQ:BBRY)’s outlook. We don’t know if they are betting on the company’s smartphone sales to rebound or are expecting the company to sell or discard the smartphone segment and focus entirely on software, but we can see that the company’s stock gained almost 50% in 2014. Moreover, as we looked at the numbers from the latest round of 13F filings, we can see that BlackBerry was one of the companies with the highest inflow of capital from investors. Among 730 funds that we track, 25 reported long positions in the company, with a total value of $756.82 million. The number went up from 17 funds holding $631.18 million worth of the company’s stock at the end of the third quarter of 2014.