BlackBerry (TSX:BB) Could Be 34% Undervalued On A Post Rally Reality Check
BlackBerry (TSX:BB) shares declined 3.13% on September 2, 2026, as earlier gains prompted profit taking and a fresh look at valuation after a strong rally in the software-focused stock.
That pullback comes after a sharp run, with BlackBerry’s share price up 103.83% year to date, even though the 30 day share price return is down 13.36% and the 90 day share price return is down 18.65%. The 1 year total shareholder return sits at 98.14%, suggesting strong longer term momentum despite recent cooling.
Compare BlackBerry's sharp move with other software and security stocks showing strong price and fundamentals momentum in our hand picked 9 high quality undiscovered gems list.
After a near doubling in 1 year total return and a recent pullback, the real question for BlackBerry now is whether that reset leaves enough upside to justify the risks. The valuation numbers give some useful clues.
Most Popular Narrative: 34.4% Undervalued
On the numbers, BlackBerry’s narrative fair value of CA$16.22 sits well above the last close of CA$10.64. That gap is what the most followed thesis is trying to explain.
The market is pricing BlackBerry as a maturing automotive software company. What it actually has is the safety infrastructure layer that physical AI cannot be commercially deployed without. The automotive royalty backlog took fifteen years to reach $950M. The physical AI backlog is starting from zero right now, in a faster-growing market, with the same royalty model and the same impossibility of removal once embedded.
Want to see how this thesis gets to that higher fair value? The key is how it treats recurring royalties, long design cycles, and future profit margins for physical AI.
Result: Fair Value of CA$16.22 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, investors still need to weigh execution risks, including long physical AI timelines and the chance that major automakers or industrial clients pursue in-house alternatives.
Find out about the key risks to this BlackBerry narrative.
Another View On BlackBerry’s Valuation
That 34.4% narrative discount focuses on long term cash generation from QNX and physical AI. The market’s current P/E of 75.4x tells a different story. It is more than double the North American software average of 32.3x and well above a fair ratio of 31.3x. How comfortable are you paying that kind of premium for the thesis?
See what the numbers say about this price — find out in our valuation breakdown.
Next Steps
If this BlackBerry story feels finely balanced between promise and concern, move quickly to stress test the numbers and narrative yourself with the 3 key rewards and 1 important warning sign.
Looking for more BlackBerry sized opportunities?
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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