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As soon as Sprint Nextel Corp. (NASDAQ: S) and Palm Inc. (NASDAQ: PALM) announced the Palm Pre back in January, Palm's stock has shot up from just over $3 to today's close of over $10. All this based on the announcement of an untested (albeit incredibly slick) new handset called the Pre. It debuts on Sprint's network on June 6 and is being billed by many as the "iPhone killer" that so many phones have tried to be but failed at.
The iPhone is not just a phone (like the iPod) -- it's an entire ecosystem of related, easy-to-use services that integrate one universe out of seemingly separate products. Palm's Pre, while looking like an actual innovation to the aging iPhone, has not even been released, nor does it have the ecosystem built up like Apple Inc. (NASDAQ: AAPL) has, an ecosystem that is famous for with so many of its products. Yet, hype and more hype have propelled Palm shares to three times their January 2009 levels. Why?
It's just another market-frenetic attempt at trying to pump an untested product with a struggling wireless partner, regardless of how innovative or market-changing the Pre will be. Is there anything the Pre could be that would propel Palm shares any higher? What kind of expectation will the Pre launch into next week? Unrealistic ones? Who knows -- but one thing is clear: Palm shares will defy gravity if the price keeps pegging upward with so many untested and unanswered questions throughout the rest of 2009.
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Reader Comments (Page 1 of 1)
5-28-2009 @ 4:23AM
AlexBST said...
I think Palm is facing an uphill battle against Apple and RIM. Despite the Pre, Palm has not many chances to change the course. They should look someone's help if they want to do so.