In early trading today, 3Com Corp. (Nasdaq: COMS) climbed 4 1/16 to a record 108 3/16 as the initial public offering price for its Palm, Inc. (Nasdaq: PALM) unit was increased to $38 a share.
There are indications that Palm — which is already one of the hottest IPOs this year — and 3Com are headed even higher: ABN Amro analyst Jonathan Ross initiated coverage of Palm, which begins trading today, with a “buy” recommendation and a six-month price target of $90.
“This is a company that’s creating the wireless Internet economy,” Ross told the E-Commerce Times. “We think that there’s absolutely phenomenal opportunity locked up as we shift to the new wireless Internet paradigm.”
Palm, said Ross, has a 70 percent market share in the “personal-companion” market, which includes so-called “smart phones” made by Motorola and Nokia. He added that the Palm Pilot is gaining popularity faster than the competition.