Investors Now More Confident In BlackBerry’s Turnaround

 

I Told You So
Photo: 30minuteyogamom.com

One way to gauge the confidence that investors have in a company is to look at the number of shares that are shorted.

A short share is a share that an investor sold without ever owning it, in the hopes that they’ll be able to buy the share if the share price drops later on. In other words, they first sell shares which they don’t own at a high price, they wait until the share price drops, and then they buy the shares at the lower price. Instead of buying low and selling high, they’re selling high and then buying low. If the share price goes up instead of down, then they lose money since they will have to buy the share at a higher price than what they sold it for at the beginning.

Investors sell short shares (known as short selling) when they believe the company’s share price will go down.

For the past while, BlackBerry shares have been one of the most shorted shares on the NASDAQ, reflecting many investors’ belief (or certainty, as the haters would say) that BlackBerry was going to die. In March 2015, before BlackBerry’s earnings report, the number of BBRY short shares rose from 88.27M (ratio of 10.90) to 95.57M (9.80), reflecting their belief that BlackBerry’s earnings report would be disappointing. As of March 31, 2015, BBRY short shares dropped to 92.69M, for a short ratio of 7.60.

BBRY Short Stats 02-27-2015
BBRY Short Stats 02-27-2015
BBRY Short Stats 03-13-2015
BBRY Short Stats 03-13-2015
BBRY Short Stats 03-31-2015
BBRY Short Stats 03-31-2015

So while the haters and trolls in the media are spreading FUD and predicting doom & gloom for BlackBerry, more and more short sellers are showing they believe in BlackBerry’s future by abandoning their short positions.

bartron

I'm programmer with 13 years experience, and a former electronics technician. My first BlackBerry was a Z10, and I'm now rocking a Passport.

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