By Euan Rocha
TORONTO (Reuters)-$ 19 billion of Facebook Inc. fast growing mobile messaging to launch WhatsApp BlackBerry actions sent higher before the Bell Ltd of opening Thursday as investors placed bets that its creator smartphone messaging platform has been underestimated.
BlackBerry shares were more than 9 percent in trading after the Bell Wednesday as the deal boosts evaluation metrics about the BlackBerry messaging service.
BlackBerry Messaging, BBM, was a ground-breaking mobile messaging service, but its userbase has failed to keep pace with that of WhatsApp and other upstarts, partly because BlackBerry has long refused to open the service to users on other platforms.
WhatsApp, with a user base of approximately 450 million, has grown rapidly. The service works on Apple's iOS platform Inc., market-dominating the Android operating system from Google Inc. and with devices powered by Windows operating systems is the BlackBerry.
BBM remains popular, though BlackBerry devices have declined in popularity. Late last year, the company based in Waterloo, Ontario has finally opened the messaging platform for users of iPhone and Android devices, and the number of active users of the service has grown to more than 80 million.
However, investors have little value attributed to the assets within the company. In a note to clients on Tuesday, Raymond James analyst Steven Li broke an evaluation of sum-of-parts of BlackBerry and BBM value pegged at only $ 240 million, or $ 3 per user.
Assessing WhatsApp Facebook translates into about $ 42 for each user, and that could bring investors and analysts to rethink their assessment of the asset within the BlackBerry.
BlackBerry did not give any indication of interest in the sale of the asset. While there has been some speculation that the company might try to carve out the unit, or even sell it, new CEO John Chen has so far hinted that BBM is a core asset.
Wells Fargo analyst Maynard Um said the Facebook deal-WhatsApp has upside potential for its assessment of BBM.
"However, unless the Administration plans to sell the unit, it is, in our opinion, difficult to add incremental value because the unit is probably in deficit and will require investment," Um said in a note to clients Thursday.
After rising as high as $9,82 in after-market trading on Wednesday, shares of BlackBerry settled at about $9,54, well above $9,01 is closed. The stock was about 5.5 per cent to $9,51 in trade before the morning Bell Thursday.
Acquisition of Facebook has pushed TD Securities analyst Scott Penner to increase its assessment on BBM for $ 800 million, or $ 10 for each user, from $ 400 million, or $ 5 for each user.
"BBM engagement metrics stack up well with WhatsApp," Penner said in a note to clients. Is this deal highlight the value of messaging platforms.
(Edited by Lisa Von Ahn)
Investment company InformationFinanceFacebookWhatsAppBlackBerry & LtdBBM
TORONTO (Reuters)-$ 19 billion of Facebook Inc. fast growing mobile messaging to launch WhatsApp BlackBerry actions sent higher before the Bell Ltd of opening Thursday as investors placed bets that its creator smartphone messaging platform has been underestimated.
BlackBerry shares were more than 9 percent in trading after the Bell Wednesday as the deal boosts evaluation metrics about the BlackBerry messaging service.
BlackBerry Messaging, BBM, was a ground-breaking mobile messaging service, but its userbase has failed to keep pace with that of WhatsApp and other upstarts, partly because BlackBerry has long refused to open the service to users on other platforms.
WhatsApp, with a user base of approximately 450 million, has grown rapidly. The service works on Apple's iOS platform Inc., market-dominating the Android operating system from Google Inc. and with devices powered by Windows operating systems is the BlackBerry.
BBM remains popular, though BlackBerry devices have declined in popularity. Late last year, the company based in Waterloo, Ontario has finally opened the messaging platform for users of iPhone and Android devices, and the number of active users of the service has grown to more than 80 million.
However, investors have little value attributed to the assets within the company. In a note to clients on Tuesday, Raymond James analyst Steven Li broke an evaluation of sum-of-parts of BlackBerry and BBM value pegged at only $ 240 million, or $ 3 per user.
Assessing WhatsApp Facebook translates into about $ 42 for each user, and that could bring investors and analysts to rethink their assessment of the asset within the BlackBerry.
BlackBerry did not give any indication of interest in the sale of the asset. While there has been some speculation that the company might try to carve out the unit, or even sell it, new CEO John Chen has so far hinted that BBM is a core asset.
Wells Fargo analyst Maynard Um said the Facebook deal-WhatsApp has upside potential for its assessment of BBM.
"However, unless the Administration plans to sell the unit, it is, in our opinion, difficult to add incremental value because the unit is probably in deficit and will require investment," Um said in a note to clients Thursday.
After rising as high as $9,82 in after-market trading on Wednesday, shares of BlackBerry settled at about $9,54, well above $9,01 is closed. The stock was about 5.5 per cent to $9,51 in trade before the morning Bell Thursday.
Acquisition of Facebook has pushed TD Securities analyst Scott Penner to increase its assessment on BBM for $ 800 million, or $ 10 for each user, from $ 400 million, or $ 5 for each user.
"BBM engagement metrics stack up well with WhatsApp," Penner said in a note to clients. Is this deal highlight the value of messaging platforms.
(Edited by Lisa Von Ahn)
Investment company InformationFinanceFacebookWhatsAppBlackBerry & LtdBBM
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