NewsPalm downgraded to "sector perform"
09/08/06 - RBC Capital Markets
NEW YORK, September 8 (newratings.com) - Analyst Mike Abramsky of RBC Capital Markets downgrades Palm Inc (PALM) from "outperform" to "sector perform," while reducing his estimates for the company. The target price has been reduced from $23 to $16.
In a research note published yesterday, the analyst mentions that the company has reduced its 1Q revenue guidance by around $30 million. The likely launch of a sub-$300 Treo, which is expected in 2Q, may not be able to offset the slowdown in momentum on account of pricing pressures and competition from RIM, Nokia and Motorola, the analyst says. The company’s FY07 guidance of 20%-25% growth appears difficult to achieve, RBC Capital Markets adds. The EPS estimates for 2007 and 2008 have been reduced from $1.09 to $1.02 and from $1.26 to $1.16, respectively.