What happened
Shares of BlackBerry (BB +13.17%) jumped 12.3% last month, according to data provided by S&P Global Market Intelligence, after the company announced that two of its products had passed security tests.
The technology company has become a so-called "meme stock" this year as some investors were drawn to its beaten-down share price and bought up shares, hoping for a massive rebound of the stock.
So what
BlackBerry said in a press release on Aug. 24 that two of its products -- BlackBerry Protect and BlackBerry Optics -- had undergone "a range of hacking real-world attacks designed to compromise systems and penetrate target networks," and both passed with flying colors.
Image source: Getty Images.
BlackBerry Protect is the company's AI-driven endpoint protection product; BlackBerry Optics is its endpoint detection and response product.
BlackBerry said the tests were conducted by SE Labs and that its two products were "able to provide complete prevention, complete detection, and zero false positive results, earning SE Lab's maximum AAA rating for its excellent performance."
While it's important for BlackBerry to show that its products are safe, the reaction by inventors might have been an exaggeration. Investors of meme stocks tend to get very excited about small bits of good news, and it appears that BlackBerry's August price jump was an example of exactly that.
Now what
BlackBerry does have a more solid business than some meme stocks and is currently working with Amazon to create a cloud-connected software platform for automakers, called IVY. But with the company's shares seemingly being bought and sold by some meme stock investors, it means long-term investors might need to be more cautious about BlackBerry right now.
