Shares of Palm rose more than 8% on Friday, fueled by renewed speculation that the maker of the Treo smartphones may be a takeover target.
Palm shares recently rose as high as $18.03 on Nasdaq. Ongoing chatter about a possible acquisition of Palm has helped drive the stock up more than 25% this year.
The recent speculation has focused on Nokia as a potential buyer. However, other companies such as Motorola have been mentioned in the past as possible suitors.
"The rumors are alive and well this morning regarding Nokia's interest in purchasing Palm," said Pete Najarian, co-founder of Web site optionmonster.com. "We are seeing extreme call buying in Palm, mostly the March calls with $17.50 strike prices."
Officials for Palm andNokia were not immediately available for comment.
Palm's Treo is popular in the business community with users who need mobile access to email and data. Treo competes with Research In Motion's Blackberry and other smartphones from companies such as Motorola. Smartphones combine the features of a cell phone, Internet and email access and a personal organizer into one handheld device.
The Sunnyvale, Calif.-based company has been viewed as a takeover target because it is dwarfed by its rivals. In addition, it has been under pressure by fierce competition in the sector.
Still, Palm has attractive technology and products such as the Treo have been popular.