Palm Inc. (PALM) Rises Further on Buyout Speculation
With its future as a stand-alone device company in jeopardy as competition in the smartphones space intensifies, speculation over a possible sale has sent shares in Palm Inc. (PALM, 18.83) to 10-month highs.
Considering every major device maker from Nokia (NOK, 22.16) to Research In Motion (RIMM, 132.15) to Motorola (MOT, 18.29) could be a potential buyer, the rumor mill has been running at full force. In March, the Wall Street Journal reported the company was working with an investment banker, later named as Morgan Stanley, to explore strategic options.
Today, the technology Web site Unstrung.com reported the company is close to finding a buyer. The potential price tag could be around $20 per share with the purchase finalized as soon as March 22nd, according to the site, which cited unidentified people close to the transaction. Palm is scheduled to report its interim results this week, which has hurried the pace by bankers to lock up the deal, according to the site.
The maker of the Treo e-mail device has declined to comment.
All this speculation has pushed PALM valuations well ahead of its closest rivals, as shares have gained over 30% since the end of January.
Given the heightened expectations, the worst case scenario at this point is for this phantom deal to fall through or to be priced well below expectations. For investors, we would steer clear of this trading stock as its fundamental outlook remains highly questionable.
--Kimberly DuBord, Briefing.com
Considering every major device maker from Nokia (NOK, 22.16) to Research In Motion (RIMM, 132.15) to Motorola (MOT, 18.29) could be a potential buyer, the rumor mill has been running at full force. In March, the Wall Street Journal reported the company was working with an investment banker, later named as Morgan Stanley, to explore strategic options.
Today, the technology Web site Unstrung.com reported the company is close to finding a buyer. The potential price tag could be around $20 per share with the purchase finalized as soon as March 22nd, according to the site, which cited unidentified people close to the transaction. Palm is scheduled to report its interim results this week, which has hurried the pace by bankers to lock up the deal, according to the site.
The maker of the Treo e-mail device has declined to comment.
All this speculation has pushed PALM valuations well ahead of its closest rivals, as shares have gained over 30% since the end of January.
Given the heightened expectations, the worst case scenario at this point is for this phantom deal to fall through or to be priced well below expectations. For investors, we would steer clear of this trading stock as its fundamental outlook remains highly questionable.
--Kimberly DuBord, Briefing.com
posted by Stock Administrator @ 9:40 PM
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