BlackBerry Given Underweight Rating by Morgan Stanley

Morgan Stanley reissued their underweight rating on shares of BlackBerry in a research report released on Monday morning. Morgan Stanley currently has a $7.00 price objective on the stock.

“BlackBerry Q4 results beat earnings estimates through better cost management and tax benefits, but fell far short on revenue as device sales continue to slow. Getting to stated targets increasingly looks like it will need to come via acquisition.,” the firm’s analyst wrote.

BlackBerry reported financial results for the three months and fiscal year ended February 28, 2015 today and showed a small profit of $28 million, or $0.05 per share, on revenue of $660 million. While the company is officially in the black for the first time in several quarters — last quarter, the company announced a tiny non-GAAP profit, but a GAAP net loss of $148 million — revenue is down significantly.

BlackBerry’s main issue continues to be the loss of smartphone customers. It recognized sales of 1.3 million devices, down from 2 million in the previous quarter. And while ASP (average sales price) increased to $211 from $180 thanks to the Passport, the overall revenue hardware breakdown dropped from 46% last quarter to 42% in the three months ending February 28th. Revenue from software increased 2% to 10% of overall revenue, while services increased 1% to 47%.

Shares of BlackBerry opened at 9.46 on Monday.

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