Morgan Joseph Downgrades Palm (PALM) to Hold; Risk-Reward Ratio No Longer in Our Favor
PALM Hot Sheet
Rating Summary:0 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 16 | Down: 7 | New: 23
Morgan Joseph downgrades Palm, Inc. (Nasdaq: PALM) from Buy to Hold.
Morgan Joseph analyst says, "We are downgrading our rating on Palm shares to HOLD from BUY given the stock's virtual achievement of our $10.00 price target. Palm closed the 30% discount (at the time of our January 9th upgrade) to Research in Motion's (Nasdaq: RIMM) valuation and now trades at 2.5x CY09 EV/Sales, in parity with RIMM's current 2.6x CY09 EV/Sales. We believe that, while Palm's share price could continue to benefit from upward momentum, the shares are fully valued and the risk-reward ratio is not attractive at this level. Should shares of Palm pull back to a level where the risk vs. reward scenario is once again attractive, we would revisit the valuation and our rating...We are maintaining our CY09 sales and non-GAAP EPS estimates of $612mm and a loss of $1.71, respectively. For CY10, we are also maintaining our estimates of $787mm and a loss of $0.97, respectively."
To see more analyst ratings on PALM Click Here.
Palm, Inc. (Palm) is a provider of mobile products. It offers Treo and Centro smartphones, handheld computers and accessories through a network of wireless carriers, as well as retail and business outlets worldwide.
Morgan Joseph analyst says, "We are downgrading our rating on Palm shares to HOLD from BUY given the stock's virtual achievement of our $10.00 price target. Palm closed the 30% discount (at the time of our January 9th upgrade) to Research in Motion's (Nasdaq: RIMM) valuation and now trades at 2.5x CY09 EV/Sales, in parity with RIMM's current 2.6x CY09 EV/Sales. We believe that, while Palm's share price could continue to benefit from upward momentum, the shares are fully valued and the risk-reward ratio is not attractive at this level. Should shares of Palm pull back to a level where the risk vs. reward scenario is once again attractive, we would revisit the valuation and our rating...We are maintaining our CY09 sales and non-GAAP EPS estimates of $612mm and a loss of $1.71, respectively. For CY10, we are also maintaining our estimates of $787mm and a loss of $0.97, respectively."
To see more analyst ratings on PALM Click Here.
Palm, Inc. (Palm) is a provider of mobile products. It offers Treo and Centro smartphones, handheld computers and accessories through a network of wireless carriers, as well as retail and business outlets worldwide.
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