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Palm (PALM) is scheduled to release Q2 earnings this Thursday December 17, after the market closes.

Average analyst estimates for the smart phone maker are $-.32/share in EPS and $265.52 million in Revenue. Twenty-three analysts track the stock with one upward EPS revision in the last 30 days and one downward EPS revision in the last 30 days.

Last quarter, Palm beat average analysts expectations by .15/shr or 60%, -.10/shr vs. -.25/shr.

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 through 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, -100 is the lowest and 100 is the highest sentiment).

Sentiment for PALM

Source Piqqem

The above chart shows Palm’s sentiment declining by 18 pts from the beginning of the quarter to today, with an alarming decrease of 8 pts from the end of the quarter through today. This last indicator has historically been the most accurate indicator regarding an earnings surprise, both upside and downside. On the Piqqem scale, Palm’s sentiment rating of -32.77 indicates low quality and this is considered a sell. Only Palm knows their actual results, but their current sentiment points to Palm just meeting or missing earnings estimates on Thursday.

Disclosure: No Positions

Source: Palm: Ahead of Earnings, Sentiment Heads Downward