BlackBerry Stock Is Tumbling Tuesday: What's Going On?
Portfolio Pulse from Adam Eckert
BlackBerry Ltd (NYSE:BB) shares dropped in after-hours trading following the announcement of a proposed private offering of $160 million Convertible Senior Notes due 2029, exclusively to qualified institutional investors. The company plans to use the proceeds to repay or repurchase its outstanding $150 million 1.75% extendible convertible unsecured debentures due next month. Despite a slight improvement in stock performance and revenue over the past three months, analysts remain neutral, with RBC Capital's Paul Treiber predicting an 11.11% decline in the stock.
January 23, 2024 | 9:32 pm
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BlackBerry's after-hours stock price decline is a direct reaction to the proposed private offering of Convertible Senior Notes. The offering may dilute current shareholders but is intended to address near-term debt obligations.
The stock price is likely to be negatively impacted in the short term due to the potential dilution effect of the Convertible Senior Notes and the market's reaction to the company's need to manage its debt. However, the repayment of existing debt could be viewed positively in the longer term.
CONFIDENCE 85
IMPORTANCE 75
RELEVANCE 100