Palm shares advance ahead of Pre phone launch

1:52 AM Edited by Blony

Shares of Palm Inc. rebounded Tuesday amid anticipation for its new smart phone, the Pre, which goes on sale June 6 for $200.

Palm's shares rose $1.02, or 10.1 percent, to $11.14 in afternoon trading as the broader market advanced on encouraging consumer confidence data. The stock had closed at $9.93 on Friday, dropping below a $10 close for the first time this month.

The Pre could provide a sales boost for Palm, which has fallen behind its rivals, including iPhone maker Apple Inc. and BlackBerry maker Research in Motion Ltd.

On Tuesday, RBC Capital Markets analyst Mike Abramsky raised his target price on Palm's shares to $14 from $12.

"Overcoming skepticism, we believe Pre will be positively received, boosting sentiment regarding Palm's prospects," the analyst wrote in a note to investors. He rates Palm "Outperform."

Abramsky said the Pre is different from both the iPhone and the BlackBerry -- but the phone, along with its operating system, "offer benefits of both."

He also called the Pre's price tag a "sweet spot."

via mobilitytoday