in

Options Traders, Analysts Blast BlackBerry Stock After Earnings

7 Rules for Banking 8%+ Dividends (and 100%+ Gains) in Closed-End Funds

BlackBerry Ltd (NYSE:BB) stepped into the earnings confessional last night, where the communications concern reported fiscal second-quarter losses and revenue that were better than Wall Street anticipated. However, BB was still last seen 3.4% lower to trade at $146.57, after the company offered a weak current-quarter outlook following a fall in cybersecurity revenue.

Options activity is ramping up in response. At the session’s halfway point, around 14,000 calls and 6,131 puts have been exchanged so far, which is triple the intraday average volume. Most popular by far is the weekly 9/30 5.50-strike call, followed by the 4.50-strike put in the same series.

It’s also worth pointing out that BB ranks low on the Schaeffer’s Volatility Scorecard (SVS), with a score of just 7 out of 100. In other words, the security has consistently realized lower volatility than its options have priced in, making the stock a potential premium-selling candidate.

Additionally, BlackBerry stock was hit with no less than four price-target cuts. CIBC slashed its price target to $4.50 from $5, TD Securities lowered its objective to $4.75. Sentiment wa already bearish coming into today, with three covering brokerages at a “hold,” and three at a “sell” or worse. 

Today’s negative price action was saved by the $4.80 level, but BlackBerry stock continues to underperform the broader market, The equity is off by more than 45% both year-to-date and year-over-year, and its mid-August rally was cut short by it 200-day moving average.

 

When inflation rises, it’s not difficult to notice higher prices. But you don’t have to be very old to understand the expression that a dollar doesn’t buy as much as it used to. The Happy Meal was introduced in 1979 for a price of $1.10. Today, that same meal costs $2.99. Yet, it remains one of the restaurant chain’s most popular items. It’s also a barometer for the economy because of its convenience for parents.

And consider the iPhone which costs 81% more in 2022 than the initial model that launched in 2007. Yet despite the increase in price, consumers are willing to pay whatever is required.

The key to both of these examples, and others like them, is pricing power. A company that has the ability to raise its prices can maintain its profit margins. That means it delivers consistent results regardless of what’s happening in the broader economy. In good times, this may be taken for granted. But when the economy slows down, that consistency stands out.

In this special presentation, we’re looking at seven companies with significant pricing power at all times, particularly with inflation currently running at 40-year highs.

View the “7 Stocks with the Pricing Power to Push Through High Inflation”.

Written by Steve Ives