On Thursday, BlackBerry Ltd (NYSE:BB) said it has sealed an agreement with professional services company Deloitte to assist OEMs and companies involved in building mission-critical applications to secure their software supply chains.
BlackBerry shares soared nearly 3% following the announcement, boosting the year-to-date gains to over 46%. The stock is now up more than 110% over the last 12 months, pushing its forward P/E ratio to a steep 93.60.
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Deloitte wants to use BlackBerry’s Jarvis™ to provide Open-source Software among other services and insights on behalf of their clients, helping to keep the software safe and secure.
A G7 ministry has already chosen the joint platform to ensure the security of its traffic management and broader transportation infrastructure.
Should you bet on BlackBerry’s growth?
BlackBerry continues to struggle to sell its new line of business to investors after the collapse of the smartphone unit. The company has focused on software and infrastructure without experiencing significant success.
However, its competitive edge has been a lot better, thereby enhancing its chances for growth. As a result, growth investors continue to bet on the stock, pushing its stock price to a steep valuation.
Nonetheless, with analysts expecting its bottom line to improve significantly from next year, BlackBerry could be about to turn a corner. Its partnership with Deloitte will boost its attraction to investors, thereby improving its long-term outlook.
As a result, BlackBerry looks like a good long-term buy for investors willing to overlook short-term turbulence.
The rebound seems poised to continue
Technically, BlackBerry shares seem to have recently bounced off the trendline support of a sideways channel formation. Moreover, the stock still trades below the 100-day moving average and is far from reaching overbought conditions.
Therefore, investors could target extended rebound profits at about $10.70, or higher at $11.97. On the other hand, if the rebound ends prematurely, initiating a pullback, the stock could find support at $8.17, or lower at $6.90.
BlackBerry looks like a solid buy
In summary, although BlackBerry shares are up more than 46% this year, the stock seems to have found solid support around the $9.50 level.
Therefore, with shares far from reaching overbought conditions following the recent rebound, it could be time to buy the stock.
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