24/7 Wall Street has released
its list of the ten brands that it says will disappear in 2010. Some of the companies it picks are fairly obvious because of their ongoing financial troubles, but some might surprise you. Palm Pre users will not be happy to hear that the publication thinks Palm will fold or be sold in 2010.
Palm. The smart phone company had a modest success with the launch of its Pre. The follow-on product, the Pixi, is not doing as well. The Pre is facing renewed competition from the Motorola Droid and new high-end handsets from Nokia and Samsung. It competes with the two smart phone juggernauts the Apple (NASDAQ:AAPL) iPhone and RIM (NASDAQ:RIMM) Blackberry. In an effort to push sales, Amazon (NASDAQ:AMZN) dropped the price on the Pre to $79.99. Palm needs a deal with both AT&T Wireless (NYSE:T) and Verizon to supplement the one it has with Sprint (NYSE:S). It is not clear that those partnerships will be formed. Pre sales have fallen off, if a number of Wall St. analysts are correct. Many analysts have sharply dropped their stock price targets to $10 based on concerns that Palm will significantly miss its earnings targets.
The firm's stock has decreased from over $18 earlier this year to $11. Nokia has forecast that global handset sales will only rise 10% next year, which will make it nearly impossible for the market to support the number of manufacturers in the business today. Both LG and Samsung, the No.2 and No.3 handset companies, have weak smart phone lines. Each is jealous of its brand. With a market cap of $1.7 billion, Palm is a cheap way to move further into the high-end handset business.
The other brands it says will disappear are Newsweek, Motorola, Blockbuster, Borders, Fannie Mae and Freddie Mac, Ambac Financial Group, Eastman Kodak, Sun Microsystems Inc., and E*Trade. See the full explanation for the gloomy predictions here.
