Palm's Pre: Salvation in Sunnyvale?
Palm’s new hail-Mary handset, the Pre, has serious Miracle-in-Miami potential if the latest word from Deutsche Bank is to be believed. In a note to clients today, Deutsche analyst Jonathan Goldberg was decidedly optimistic about Pre’s chances of lifting Palm (PALM) out of its downward spiral. “After channel checks and a company meeting with Palm at the Mobile World Congress in Barcelona we are raising our rating on Palm to Buy,” he wrote. “We see clear signs that they are capable of executing to plan and shipping the Pre at least on time. We found a lot of carrier interest in the device as well.”
That bodes well for Palm, which appears to be well on its way to reversing its long downward trajectory and shifting the company story from also-ran to in-the-running. “Palm has been beaten down for so long that even a modest success could generate significant earnings leverage,” Goldberg concluded. “Numbers in the next two quarters will still be dismal, but the Pre offers a meaningful break with the past.”