For Immediate Release

Chicago, IL – March 22, 2010 – announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Palm Inc. (PALM), Sprint (S), Verizon (VZ), Apple Inc. (AAPL) and Research In Motion (RIMM).

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Here are highlights from Friday’s Analyst Blog:

Palm Disappoints on Weak Outlook

We do not see a turnaround at Palm Inc. (PALM) in the near future. The shares fell 14.5% after the market closed yesterday, following the company’s third-quarter of fiscal 2010 earnings announcement. The shares have fallen by more than 50% this year.

Although its loss narrowed in the quarter, driven by higher year-over-year sales, Palm provided disappointing revenue guidance for the fourth quarter. Management said that the revenue in the fourth quarter would come in below expectations, as a result of lower sales and reduced demand for both the Pre and Pixi smartphones at its exclusive carriers, Sprint (S) and Verizon (VZ).

Palm expects to generate just $150 million in revenue in the fourth-quarter versus $113.2 million generated in the year-ago period. While this is up year over year, it is well below the consensus estimate of $306 million. The company also expects gross margin in the mid-teens percentage range.

To grow its shrinking smartphone market share, Palm recently signed a carrier deal with Verizon. Despite this, Palm has failed to generate higher sales and profitability. While Palm expects to add other carriers to boost its customer base, we believe achieving this and seeing customer preference for its smartphone over its competitors will be extremely challenging for the company.

The inability by Palm to sell its phones have also increased inventory. Moreover, the impact of high inventory levels of its Palm Pre and Palm Pixi smartphones will continue to affect top-line growth and increase losses.

Clearly, we believe that Palm has failed to attract customers. Palm will continue to struggle as it competes against much larger competitors in the smartphone market such as Apple Inc. (AAPL), Research In Motion (RIMM) and Samsung Electronic. With weak fundamentals and waning market share, our confidence in the company’s long term prospects is low.

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