GO
Loading...

A Second Look at Palm

Thursday, 25 Mar 2010 | 6:00 PM ET

With Palm shares tumbling over the past 5 days, the desk thought it might be prudent to revisit a call made last week by Canaccord Adams analyst Peter Misek.

As you may remember, in a note to clients he said, “"We believe Palm's troubles will only accelerate as carriers and suppliers increasingly question the company's solvency and withdraw their support."

"With what appears to be roughly 12 months of cash on hand, an accelerating burn rate, a complete lack of earnings visibility, and substantial debt and preferred equity, we no longer see any value in the company's common equity."

Since Misek made that bearish prediction shares have slipped quite a bit.

With the stock around $3.75 is there any reason to step and bet a takeover may be imminent?

Misek says no. "We think any bid will be for $500 million to $750 million. They have $400 million in debt and $300 million in preferred and that leaves nothing for equity holders. We don’t see any reason for an investor to step in."

On Fast Money Misek reiterated that he has a $0 price target on the stock.

Palm Going to Zero
Palm is the one short that is working, with Peter Misek, Canaccord Adams.

______________________________________________________
Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send your e-mail to fastmoney@cnbc.com.

Trader disclosure: On March 25th, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU), (C); Kaminsky Owns (LULU) Puts; Terranova Is Short (GS), (CAL), (UAUA); Terranova Owns (QCOM); Terranova Owns (GLD) April Puts; Terranova Is Short May Crude Oil Futures; Seymour Owns (AAPL), (BAC), (MGM); Gordon Is Short Australian Dollar vs. Yen and U.S. Dollar; Tomasulo Owns (AMZN), (GS), (MSFT), (QCOM), (FCX), (XOM), (CAT), (MCD), (IBM); Tomasulo Is Long Gold Futures; Edwards Owns (UUP)

For Tim Seymour
Seygem Asset Management Owns (MTL)

For Joe Terranova
Terranova Works For (VRTS)
Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (GOK)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLV)
Virtus Investment Partners Owns More Than 1% Of (XLI)

For Patty Edwards
Edwards Owns (AAPL) For Clients
Edwards Owns (AMZN) For Clients
Edwards Owns (AKAM) For Clients
Edwards Owns (BAC) For Clients
Edwards Owns (DELL) For Clients
Edwards Owns (GOOG) For Clients
Edwards Owns (GS) For Clients
Edwards Owns (JPM) For Clients
Edwards Owns (MCD) For Clients
Edwards Owns (MS) For Clients
Edwards Owns (RIMM) For Clients
Edwards Owns (WFC) For Clients
Edwards Owns (WMT) For Clients
Edwards Owns (SPY) For Clients
Edwards Owns (QQQQ) For Clients
Edwards Owns (GLD) For Clients
Edwards Owns (JCG) For Clients
Edwards Owns (INTC) For Clients
Edwards Owns (MSFT) For Clients
Edwards Owns (WFC) For Clients
Edwards Owns (SPY) For Clients
Edwards Owns (QQQQ) For Clients
Edwards Owns (GLD) For Clients

For Mike Khouw
Cantor Fitzgerald & Co. Is A Market Maker In (AMAT)

For Anthony Scaramucci
Skybridge Owns (APL)

Contact Fast Money

  • Showtimes

    Halftime Report - Weekdays 12p ET
    Fast Money - Weekdays 5p ET
  • Melissa Lee is the host of CNBC's “Fast Money” and “Options Action.”

  • Scott Wapner is host of the "Fast Money Halftime Report," which airs weekdays from 12 p.m. to 1 p.m. ET.

  • Guy Adami is a contributor on CNBC's "Fast Money." He also is managing director of stockMONSTER.com.

  • Najarian, the "Pit Boss," is cofounder of optionMONSTER.com, a news site for options traders.

  • Finerman is president of Metropolitan Capital Advisors, Inc., a company she co-founded.

  • Founder of EmergingMoney.com

  • Chief Market Strategist for Virtus Investment Partners & CNBC Contributor

Halftime Report