Home Depot

* Update - Umi wrote up this editorial on yesterday's Home Depot news, as the stock dipped yesterday and he was writing an editorial around it. Today's much BIGGER BBRY market news here is word that former BlackBerry Co-CEO Jim Balsillie has liquidated his stock in the company. Find out what this means for BlackBerry. Headlines aside, Umi's editorial here is still a good general educational piece. * 

When I write about BlackBerry the stock, I usually don't focus too much on short term minutia. But sometimes people get freaked out over big moves in price, and sometimes it helps to look at what's happening and put it in context.

Yesterday BBRY stock from its prior close at $15.20 to lower close of $13.99. That's an 8 percent drop in a single day. For this to happen you'd think some absolutely horrible news must have been released, right?

It doesn't look that way. The only negative headline I see is the loss of Home Depot as a customer. The home improvement retailer will transition about 10,000 people to iPhones. From a quick look at the news, it seems that the story is true. Home Depot has confirmed it.

So what does all this mean?

First of all, let's look at the enterprise business. Home Depot is a large company based in the USA where BlackBerry market share has absolutely tanked. So it isn't too surprising that we're hearing of corporations dropping the platform on American soil. That's where it is most vulnerable. Obvious.

Also, BES 10 has just started its rollout over the last two weeks. We need to see how the next 6 months shape up before we know much about the BlackBerry comeback in the enterprise, as the company has switched gears in this transition by supporting BYOD quite heavily.

Next, let's look at the real issue that affects valuation: success or failure in the consumer market.  BlackBerry 10 is out. It's quite clear to me that BlackBerry isn't giving up and they certainly havent' shown up to a gun fight with a dull knife. The Z10 is a stunning device with a beautifully fluid OS. The app ecosystem is improving enormously. The product is differentiated and attracting a lot of consumer interest.

Apparently, investors are more worried about Home Depot than the overall consumer market. And in that all important consumer market, brand sentiment is improving. YouGov InvestorView released a survey showing that, in the US market, 43% of BlackBerry owners now plan to buy a new BlackBerry in the next 6 months. That's up from 18% in the last survey, marking a big change. Obviously this has been driven by interest in BlackBerry 10 in a market where carriers aren't even advertising it with any force yet.

Not bad, BlackBerry. Not bad at all.

Bottom line: The market gyrates like crazy and loves to speculate. In the short term these movements mean very little. There are so many factors that can go into short term trading. In the long run all that matters is the financial results.

Jim Balsillie liquidates his BlackBerry shares
Former Co-CEO Jim Balsillie now totally disconnected from BlackBerry