TORONTO - The launch of the new BlackBerry smartphone is getting off to a better start than some had predicted.
At least two analysts have weighed in with anecdotal evidence which suggests the BlackBerry Z10 is selling at solid pace in the United Kingdon since going on sale there last Thursday.
The Canadian launch on Tuesday will give further insight into how the phones will fare in the U.S. when they hit stores next month.
But so far investors appear to be impressed. The BlackBerry company's shares (TSX:BB) rose more than 15 per cent on Monday, moving ahead $1.98 to close at $14.99 on the Toronto Stock Exchange.
Earlier in the day, a senior analyst at Bernstein Research upgraded the company to "outperform" with a target price of $22, an increase from $12.
"We have grown more confident in the likely success of the Blackberry 10 launch, supported by low channel inventories, strong operator support and material pent up demand," said Pierre Ferragu from Bernstein in a note.
"Initial feedback we have received from distributors on the first days of sales is particularly positive."
Last week, Jefferies analyst Peter Misek said the new touchscreen device sales were off to a "strong start" in the UK.
"Some stores had lineups out front with widespread sell outs of the white Z10 and limited stock of the black Z10," he said in a note.
"Also, our checks indicate that pre-orders in the UAE and Canada have had a solid start. While this is not the crux of our call, these initial data points could provide some relief as many thought that the Z10 was DOA."
While some have assumed the brunt of the new phone's sales would come from longtime BlackBerry owners who were waiting for a new device, CIBC analyst Todd Coupland said his research has found that plenty of users are converts.
Coupland estimates that 50 per cent of the Canadian preorders come from people who don't currently own BlackBerrys.
"This was a surprise and a datapoint that will be watched closely in other regions," he said in a note.
The BlackBerry company, formerly known as Research In Motion, has been riding a wave of positive reviews for its new touchscreen phone, which is rolling out in various countries over the next month. A keypad version is expected to launch in April.
Despite the positive early buzz, official sales numbers likely won't be available for at least several more weeks or longer.
And just because analysts are optimistic about preliminary numbers it doesn't mean they're convinced about the viability of the company in the longer term.
"We remain skeptical of BlackBerry's ability to orchestrate a sustainable comeback," Ferragu added after boosting his outlook.
"But we believe that a successful launch will increase the option value of credible positive outcomes like a stabilized niche positioning, the development of new business models, strategic partnerships or even an acquisition."