Wells noted that, ceteris paribus, every 100,000 BlackBerry 10-equipped units being sold equates to 1 cent in incremental EPS upside.
For BlackBerry's fiscal Q114 (May quarter), Wells is estimating unit sales of 3.5 million, revs of $3.36 billion, and EPS of 7 cents. The firm notes that its unit sales are conservative to the Street consensus, which has risen over the past few weeks, given that it doesn't "have the precision to forecast timing and recognition of US units that could have shipped in the May quarter for sale in June."
Looking to fiscal Q214 (August quarter), Wells is raising estimates with the addition of 1 million Q5 units. Revs and EPS are expected to be $3.4 billion and 15 cents.
Fiscal 2014 EPS expectations are raised to 32 cents, with the Street at 33 cents. Wells commented, "We think there could be upside potential to our FY2014 but take a conservative approach to seasonality and A10 holiday release given current limited visibility (though early buzz is fairly positive). While we are essentially in line with the Street, we think there is little investor confidence BlackBerry will be able to achieve these ests."
Sentiment: Strong Buy
For the record, while there are many smaller firms that have also upgraded and downgraded BlackBerry, I think the opinion of the big boys matters the most. So as a reminder, the big boys that have upgraded BlackBerry of late are the following:
Goldman Sachs currently has a $17 12-months target price and a rating of neutral.
Morgan Stanley currently has an overweight rating with a target price of $22.
Societe Generale (link above) has a target of $17 with a buy rating.
Wells Fargo has an outperform rating with a target price of $20 a share.
Finally, Jefferies has a buy rating on BlackBerry, with a 12-month target of $22 a share.
And there will be more upgrades coming in the next 2 weeks - I am predicting 25 mid July caused by huge short squeeze then a pull back to 20, if things go as they seem to be shaping up! If this thing pops from a huge squeeze your gonna see a lot of short term / day traders coming in!