BlackBerry Rallies On Qualcomm Settlement Before Tuesday Tank

After it was reported in April that BlackBerry Ltd BBRY and QUALCOMM, Inc. QCOM had resulted in a settlement, the final arbitration announced last week was $100 million more than expected.

The final arbitration number of $940 million sent Qualcomm’s stock down nearly 2 percent while BlackBerry went up by over 2 percent and hit a four-year high. According to Raymond James research analyst Steven Li, he expects “minimal taxes and therefore this will boost an already strong balance sheet (post award expect $2.6 billion in cash, $2 billion in net cash).”

He added, “We believe BBRY could redeploy some of that cash into potential M&A to accelerate its strategy.”

All Good Things Must Come To An End

Li downgraded BlackBerry to Market Perform with an $11 price target. The report said the analyst is just “tapping the brakes” on the stock.

Blackberry still has a clean path to $1 billion in software revenues according to Li. However, “the revenue growth part of the story still requires strong execution by the BlackBerry team.” The report also noted that licensing agreements could be a key catalyst for BlackBerry.

Since the downgrade, shares of BlackBerry have fallen nearly 5 percent and were sitting down 4.5 percent at $10.61 at time of publication.

The Benzinga Pro Newswire has been following these events and their effect on BlackBerry with exclusive content and updates on the stock.