Palm has seen its stock rocket (well increased almost 20%) on the back of rumours that Chinese owned laptop maker Lenovo could be making a move to buy the troubled mobile phone maker.

According to Dow Jones Newswires, the latest rumours of a possible suitor for Palm centre around PC maker Lenovo, whose own shares gained 2% on the chatter.

Palm’s stock surged 17.6% to $4.53 on Wednesday afternoon.

Analysts though have been quick to pour cold water on the rumours that neither Lenovo or Palm have responded to, suggesting it could have been a move by brokers to temporarily increase the price of the stock to make some mid-week cash.

What the rumours do show however, is that people are starting to talk about a possible takeover bid for the phone maker who recently announced that they've struggled to sell its new webOS handsets.

The latest show of desperation from it and the US operator is selling the Palm Pre Plus for $50 for two in US, a mighty fall from the $349.99 asking price when the original Palm Pre launched in June last year.

Do you think Palm should sell, and if so who do you think would be the best suitor? Let us know in the comments below.