Is it possible to Profit on Blackberry?

Blackberry shares hit their all time high at $148 in June 2008, and since then shares have dropped to a recent low of $5.44 in December 2013.  Shares are up 76% since in the past 3 months, and currently BBRY trades at $9.56.  Once regarded as the leader in the smart phone market, it has seen competitors change the game as an app-centric model has taken the industry in a new direction.  Apple, Motorola (Google), Samsung and HTC have all seem growth in the smart phone market, while Blackberry has lost market share.

John Chen the new CEO has been unlocking value in the company and analysts seem to like the turnaround story.  It's unclear if they will emerge as a dominant market leader again, if they get acquired, or if they monetize their patents and intellectual property.  One thing is certain though, the market sees the stock going higher based on the analyst upgrades (FBR Capital upgraded the stock to market perform today), upward movement in the stock, and the vote of confidence from Dan Loeb's 10,000,000 share (1.9%) investment in the company announced late last week.  Read more about this here: (Link to article)

We see the stock continuing to move higher, and options are priced attractively to take advantage of this trend.  

We are buying the June 2014 $9 strike Calls for $1.62.  These calls will increase in value if the stock moves higher, and will decrease if the stock goes down.  

The options will move up almost dollar for dollar if the stock goes above $10.62, which is roughly 11% higher than today's trading price.  We also have 122 days to expiration on this trade, so we can handle a modest pull back in the short term.