BlackBerry Hits Bottom

 | Nov 04, 2013 | 10:51 AM EST
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BlackBerry (BBRY) may have hit bottom this morning.

It's been a long and difficult decline over the last four years for the former smartphone leader. The latest news that Fairfax won't be proceeding with its $9-per-share buyout seems to be the latest sign that the company may be headed for the dustbin.

But I believe there's an interesting floor level of value ahead for the company and a possible intriguing future strategy that, while it may never make the company the leader of the smartphone pack again, it could be very profitable for investors.

The company has forced out CEO Thorsten Heins. That likely means its days away from turning its back on competing in the handset business. It has brought in John Chen as CEO, who formerly led Sybase from irrelevance to a $6 billion buyout by SAP (SAP). There are apparently numerous board changes coming to BlackBerry's board also. Read that to mean Chair Barbara Stymiest and longtime director Roger Martin are likely hitting the bricks soon.

Color me intrigued by the possible future of the company formerly known as Research In Motion.

With the handset business gone and likely more headcount cuts, you're going to be left with a business focused on managing servers for enterprises, patents, BBM, and a play on the "Internet of things" with the QNX operating system.

That's an intriguing little business with lots of upside, depending on your entry point. The stock hit the low $6 range in the premarket this morning. Maybe it will get down to $5 in the next few weeks with layoff and write-off announcements.

But look past the coming commotion; there's going to be an interesting little business that's very profitable.

Before wading in, you might want to wait for the restructuring so we will know in more specifics the "real" cash levels of the company post-restructuring. But in the messy interim period, you're likely to see the bottom for BlackBerry's stock price when enough people dump it and don't want to hang around for the longer-term turnaround play.

And it looks like it will be a public company while it does this turnaround, so you'll have the chance to participate as an external investor.

Stay tuned.

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