2010: Year of the Palm?
The Pixi, the Palm Pre’s diminutive smart-phone sibling, arrives at market a few days from now (Nov. 15), and despite some potential pricing confusion with the Pre, analysts expect it to be another catalyst for the company’s comeback. In a note to clients today, Bank of America/Merrill Lynch (BAC) analyst Vivek Arya said Palm (PALM) is well-poised for growth in 2010.
“Despite increasing smartphone competition, Palm can maintain differentiation and remains well-positioned to launch its products with multiple new Tier-1 carriers in early 2010 by which time it should have a robust apps catalog,” Arya wrote. “While we expect the stock to remain volatile, the recent sell-off creates an interesting buying opportunity, in our opinion, for a company with an attractive platform, selling into a high-growth market, and at a compelling valuation.”
Interestingly, Arya notes that Palm’s webOS application ecosystem, initially something of a disappointment, is growing a bit more rapidly these days with between 50 and 100 apps being added to Palm’s App Catalog each week. He expects growth to continue with the debut of a new feature enabling customers to download apps simply by clicking on a URL. Arya believes this will dramatically improve discovery of apps and attract more attention from developers. His conclusion: With a more robust App Catalog and two attractive handsets, Palm is well-positioned to launch its webOS line with multiple new Tier-1 carriers like Verizon (VZ) in early 2010.