Palm: Sentiment Still Weak, But Up Ahead of Earnings

Sep.17.09 | About: Palm, Inc. (PALM)

Palm (PALM) is scheduled to release Q1 earnings today (Thursday September 17th), after the market close.

Average analyst estimates for the Mobile Device maker are $-.24/share in EPS and $306.5 million in Revenue. Twenty-one analysts track the stock with two upward EPS revisions in the last 30 days and no downward EPS revisions in the last 30 days.

Last quarter, Palm beat average analysts expectations by .22/share or 35.5%, -.40/share vs. -.62/share.

I always find this a tough period waiting to see if the company is going meet, exceed, or miss their earnings estimates. One thing I have discovered of value is to analyze sentiment moves in a stock ahead of the company’s earnings release. In the case of Palm, I will use the piqqem sentiment index for Palm to see how sentiment has changed in the last quarter, for the months within that quarter, and from the end of the reporting quarter thru today.

I’m looking for moves or changes that may foreshadow the earning release. (piqqem leverages the ‘wisdom of crowds’ by allowing its users to vote on the price direction of a stock and then applies its own propriety factors to calculate sentiment for a security. In their model, 0 is the lowest and 4 is the highest sentiment).

Sentiment for Palm

Click to enlargeSource Piqqem

The above chart shows a 16% increase in Palm’s sentiment from the end of Q4 through September 15, 2009 and a 14% increase in sentiment within the quarter. On the Piqqem scale, Palm’s sentiment rating of 1.75 is considered a hold, but the increase in sentiment has to be viewed as a positive trend. Only Palm knows their actual results, but their current sentiment points to Palm meeting or beating expectations on Thursday.

Disclosure: No positions