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TheStreet Open House

Traders Bet Big on BlackBerry: StockTwits.com

Stocks in this article: BBRYGOOGAAPLMSFTFB

NEW YORK (TheStreet) -- BlackBerry (BBRY) is losing less money -- and a lot more business. And that, say investors on StockTwits.com, is progress capable of returning the company to profitability. Though it's not enough to show the beleaguered smart phone company's turnaround plan has taken hold.

$BBRY Mixed bag... BlackBerry lives to fight another day is how I'd frame it. -- matthew stafford (@vanhalenboss) Mar. 28 at 08:17 AM

Friday morning, BlackBerry reported quarterly earnings that beat Wall Street consensus estimates for earnings per share, but badly missed sales expectations. Blackberry posted a loss of 8 cents per share, excluding some items, on $976 million in revenue. Wall Street analysts had expected a 57-cent EPS loss on $1.11 billion in sales, according to estimates on the Analyst Ratings Network. Sales fell 64% from the same period a year ago.

The stock rose more than 6% in premarket trading, though it shed much of those gains during the conference call leading up to the opening bell. The stock opened 2.76% higher.

Some cashtaggers expressed surprise that the gains didn't hold through the open. The company can't be expected, they argued, to stabilize sales as it slashes expenses.

$BBRY Do you really expect BB to improve revenues in a single quarter?! restructuring takes time and judge in the next few quarters -- Khaled (@TwitsTrader) Mar. 28 at 08:18 AM

Sentiment on the stock is 89% bullish, according to StockTwits' analytics. Traders see positives in BlackBerry's ruthless cost reductions, allowing it to promise break-even results by the end of fiscal 2015.

"BlackBerry is on sounder financial footing today with a path to return to growth and profitability," said CEO John Chen in a statement. "We have significantly streamlined operations, allowing us to reach our expense reduction target one quarter ahead of schedule."

The company has plenty of cash to absorb more losses while Chen continues to implement the company's turnaround plan. Blackberry said it has $2.7 billion in cash, cash equivalents, short-term and long-term investments as of March 1.

$BBRY long term outlook still remains bullish though. -- StandpointCapitalLLC (@StandpointCapitalLLC) Mar. 28 at 09:00 AM

@vanhalenboss I agree...still a long slog ahead, and competition is not standing still. $BBRY -- Syntec Ventures (@SyntecVentures) Mar. 28 at 08:17 AM

Traders also see bullish signs in the growth of BlackBerry's messenger application.

$BBRY BBM crossed 100M users , actual 113M :)) -- Wilson (@LittleRedDot) Mar. 28 at 08:32 AM

Much has been made of the importance of messaging applications since Facebook (FB) purchased messaging application service WhatsApp for $19 Billion in February.

At the time of Facebook's mostly stock purchase of WhatsApp, the company had 450 million users. Some traders argue that the simple math of dividing the purchase price by the user base puts a value of $42 on each messenger user. Applying that worth to BlackBerry's 113 million messenger users would value BlackBerry Messenger alone at $4.7 billion.

The entire company has a market cap of $4.69 billion.

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