Violent Capitalist's  Instablog

The trajectory on this stock is pretty stupid, they are a 1 product company - a 1 product company that is steps behind the competition in every respect, to think that a financially weak mid-cap company can compete on the R&D scale of large caps without the weak balance sheet is just plain stupid.

If your long PALM I hope your praying each day that their partnership with Sprint.... pause as I chuckle...will actually amount to anything in the long-term. Short-term both companies are positioned poorly, but I'd rather invest in Sprint as a turnaround/buyout story than PALM.

Sprint...if the PRE was so awesome it will be offered by at least one other carrier by now.

Fact is that no one major, profitable, financially-well-to-do carrier really gives two cents about PALM, simply because all the other carriers have already developed working relationships with the larger players that will be sticking around for much longer - Apple, Blackberry, Samsung, Google, HTC, and whoever else is out there. It's just a matter of time they'll realize that PRE was a one-hit, hard-to-follow up product for a financially disastrously positioned company.

Not to mention their $190 mil in goodwill (probably worth what is in my toilet), actually makes their book value at -$600mil. Iphone margins are reportedly at about 20+%, good luck to you palm on beating that #, cuz without it your dead water (their current margins are 20%+). Who wants to bet that the other carriers will only give them a sub 25% (I'm being coy) cut to protect their working relationships with the larger handset players?

Talk of a buyout offer? Seriously? With all this info what kind of idiot buyer will take on this company? For all its losses and negative book value, a potential acquirer is better off just making an initial investment of their own by stealing the 2-3 employees that probably made the PRE work ($20 bucks Motorola is already on it).

I wonder if it would be considered insider trading to short $200 million of PALM and offer Rubenstein $25 million 1 yr contract to sit at home...$$$

Disclosure: I am currently short PALM stock, possibly selling more call options (another short position)