BlackBerry vs. Cineplex Stock: Which Is the Better Buy?

BlackBerry Ltd. (TSX:BB)(NYSE:BB) and Cineplex Inc. (TSX:CGX) have gained momentum in 2021, but I’m more interested in the former today.

| More on:

The COVID-19 pandemic led to a downturn in major industries. Automobile sales had surged to near-record levels in the lead up to 2020. However, the pandemic saw sales dip. Meanwhile, cinemas were forced to shut their doors for months on end. BlackBerry (TSX:BB)(NYSE:BB) and Cineplex (TSX:CGX) are two Canadian staples that have been impacted during this crisis. Which stock is the better buy today? Let’s jump in.

Where is BlackBerry headed in the second half of 2021?

BlackBerry stock has climbed 84% in 2021 as of late morning trading on June 28. Its shares are up 138% from the previous year. Back in April, I’d discussed whether the Waterloo-based tech firm was the best cybersecurity stock available on the TSX.

The company became a household name as it took the lead in the fledgling smartphone market in the mid-to-late 2000s. Unfortunately, its run at the top did not last. Competition from the Apple iPhone and Android competitors brought BlackBerry to its knees in the hardware space. In response, it made the shift to focus on software in the 2010s.

This transformation has been successful. BlackBerry has managed to establish a strong footprint in the global cybersecurity and automobile software spaces. In fiscal 2021, BlackBerry QNX scored design wins in 23 of the world’s top 25 Electric Vehicle OEMs.

Meanwhile, it introduced BlackBerry Alert Next-Gen Critical Event Management for the commercial sector. The cybersecurity and automotive software spaces are both geared up for strong growth going forward.

Here’s how Cineplex can continue its comeback this year

Cineplex is Canada’s largest movie theatre operator. It was forced to close its doors to customers in March 2020, as the severity of the pandemic first became apparent in Canada. This shift saw revenues dry up, and the company was forced to find creative solutions to stay afloat financially.

Shares of Cineplex have climbed 71% in 2021. The stock is up 50% from the prior year. Earlier this month, I’d discussed why Cineplex and AMC were on a tear. The United States has enjoyed an efficient reopening on the back of an impressive vaccine rollout.

Canada has lagged behind its southern neighbour, but it started to catch up in the late spring. Ontario is set to enter step two of its reopening process on Wednesday, June 30. Unfortunately, indoor cinemas will only be allowed to reopen by step three.

Still, Cineplex is well-positioned to take advantage of a promising film slate this summer. Consumers are hungry for any form of entertainment. There are still restrictions on travel and other activities, which could bring about a renaissance for the movie theatre. Streaming service subscriber growth has slowed for companies like Netflix, which may indicate some consumer fatigue in this space.

Which is the better buy?

BlackBerry and Cineplex have both had a hot start in 2021. Cineplex is in a good position to see its bottom line improve as movie theatres reopen this summer.

However, I’m more inclined to snatch up BlackBerry as it progresses in fast-growing industries like cybersecurity and automotive software. The cinema was in decline before the pandemic hit. It has a lot to prove after this crisis.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Ambrose O'Callaghan has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Apple and Netflix. The Motley Fool recommends BlackBerry and CINEPLEX INC. and recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple.

More on Investing

Man data analyze
Tech Stocks

3 Reasons Celestica Stock Is a Screaming Buy Now

These three reasons make Celestica stock a screaming buy for long-term investors.

Read more »

profit rises over time
Dividend Stocks

These 2 Dow Stocks Are Set to Soar in 2025 and Beyond

Two Dow Jones stocks are screaming buys but Canadians must hold them in an RRSP or RRIF to avoid paying…

Read more »

TFSA (Tax free savings account) acronym on wooden cubes on the background of stacks of coins
Dividend Stocks

How to Use Your TFSA to Earn Ultimate Passive Income

If you have a TFSA, then you have the key to creating ultimate passive income. All you need is a…

Read more »

Confused person shrugging
Dividend Stocks

Better Buy: Fortis Stock or Hydro One Stock?

Let's do a compare and contrast of these two top utilities stocks right now, shall we?

Read more »

A close up color image of a small green plant sprouting out of a pile of Canadian dollar coins "loonies."
Dividend Stocks

Boost Your Passive Income: 2 Canadian High-Yielders at a Bargain

Nutrien (TSX:NTR) stock and another play that appear like fantastic dividend bargains in mid-November.

Read more »

Super sized rock trucks take a load of platinum rich rock into the crusher.
Metals and Mining Stocks

Invest $7,000 in This Dividend Stock for $672 in Passive Income

High yield can be an essential requirement when you need to start even a modestly sized passive income with a…

Read more »

telehealth stocks
Tech Stocks

Well Health Stock: Buy, Sell, or Hold?

Another record-breaking quarter and strong demand sets the stage for continued momentum for Well Health stock.

Read more »

3 colorful arrows racing straight up on a black background.
Dividend Stocks

TSX Stocks Soaring Higher With No Signs of Slowing

Three TSX stocks continue to beat the market and could soar higher in an improving investment landscape.

Read more »