Palm Gains on Talk That Nokia May Bid for Phone Maker
Palm Inc., maker of the Pre mobile phone, gained 7 percent in Nasdaq trading, a jump that some analysts attributed to speculation Nokia Oyj may bid for Palm.
Palm, based in Sunnyvale, California, rose $1.12 to $17.07 at 4 p.m. New York time on the Nasdaq Stock Market. Palm has climbed more than fivefold this year.
Nokia, the world’s biggest mobile-phone maker, has fallen behind rivals in software for smart phones and buying Palm would help close the gap, said James Faucette, an analyst at Pacific Crest Securities Inc. in Portland, Oregon. Espoo, Finland-based Nokia is spending $3 billion a year on software research and development, more than 10 times Palm’s R&D budget, he said.
“Palm is worth $17 a share on its own, and $25 to $30 to Nokia, based on what they are spending to replicate Palm,” said Faucette. He rates Palm stock “outperform” and doesn’t own shares. Such an acquisition “would make a lot of sense,” he said.
Derick Mains, a spokesman for Palm, said the company doesn’t comment on rumors or activity about its stock. Arja Suominen, a spokeswoman for Nokia, declined to comment in an e- mail.
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Palm, based in Sunnyvale, California, rose $1.12 to $17.07 at 4 p.m. New York time on the Nasdaq Stock Market. Palm has climbed more than fivefold this year.
Nokia, the world’s biggest mobile-phone maker, has fallen behind rivals in software for smart phones and buying Palm would help close the gap, said James Faucette, an analyst at Pacific Crest Securities Inc. in Portland, Oregon. Espoo, Finland-based Nokia is spending $3 billion a year on software research and development, more than 10 times Palm’s R&D budget, he said.
“Palm is worth $17 a share on its own, and $25 to $30 to Nokia, based on what they are spending to replicate Palm,” said Faucette. He rates Palm stock “outperform” and doesn’t own shares. Such an acquisition “would make a lot of sense,” he said.
Derick Mains, a spokesman for Palm, said the company doesn’t comment on rumors or activity about its stock. Arja Suominen, a spokeswoman for Nokia, declined to comment in an e- mail.
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