Will BlackBerry’s Earnings Report Surprise Shorts?

trader staring at screensBlackBerry’s (NASDAQ:BBRY) stock has more than doubled in price since September — rising from $7.14 per share to $14.46 as of Tuesday’s close — but that gain has given investors little confidence in the company’s turnaround, on which its future rests, as increasing competition from Apple’s (NASDAQ:AAPL) iPhone and Google’s (NASDAQ:GOOG) Android devices keeps BlackBerry bleeding market share.

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Instead, short sellers have seen an opportunity, betting that BlackBerry’s fortunes will once again fade. “Short sellers remain unconvinced of the rally,” Markit director Alex Brog told The Wall Street Journal’s “MarketBeat.”

An important test for the BlackBerry bears is looming; the company will report earnings before markets open Thursday morning. As short sellers borrow shares with the intention of buying them back cheaper at a future date — aiming to profit from a price decline — their bet will only prove to be correct if the company posts negative quarterly results and shares drop.

Poor financial results are just what BlackBerry short sellers are predicting. Analysts polled by Thomson Reuters have estimated that BlackBerry will report a loss of 29 cents per share on a revenue of $2.84 billion…