The Latest Round of Rumors of a Palm Buyout

Once or twice a year, a rumor goes around the investment community that Palm, Inc. is going to be bought by some other company. This will push up Palm's stock price for a few days, then it will blow over. This cycle is apparently going to once again repeat itself.

Ken Dulaney, an analyst with market-research firm Gartner, says he was told by unnamed sources that Palm is looking for a buyer, according to SFGate.com.

After word of this rumor went around, Palm's share price jumped almost almost 7 percent in a single day. It has, however, gone down a bit since then.

A Semi-Regular Cycle

In the past, there have been quite a few times when rumors or speculation of a Palm buy-out have circulated.

The most recent of these was in September of 2006, when an analyst at ThinkEquity speculated that Motorola's plan to purchase Symbol Technologies made it more likely one of Motorola's competitors would be interested in buying Palm.

Well before that, one of Palm's chief shareholders called for the company to be sold.

Of course the often repeated cycle of rumor followed by share price rise and fall will only repeat itself this time if Palm really isn't going to be bought out.

Out of the Slump

The recent jump in Palm's share price brought about by the buyout rumor plus a steady rise in the price over the last few weeks has pulled the company's share price out of the slump it has been in for several months.

In early December, the company revealed that profits in its most recent financial quarter were hurt by delays getting the Treo 750 released in the United States.

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