Tech chatter turned this week to possible deals, with analysts and investors trying to pick logical targets.

The top deal candidates this week are

Dell

(DELL) - Get Report

and

Palm

( PALM). Palm delivered its Pre phone last weekend and, more important, the company's WebOS software, which looks to be a viable contender in the still-unfolding smartphone operating system market.

Stuck in a rut with slumping PC sales, Dell has talked about exploring deals for months, but this week CEO Michael Dell indicated he expects to make an "

significant-sized

" acquisition, according to reports. To Wall Street observers, Palm's smartphone rebirth and its tenuous financial structure suggest a ripe takeout candidate. Palm shares jumped 12% Thursday on Dell deal chatter.

On Friday, analysts at Collins Stewart

issued a note

to clients saying Dell needs a foothold in smartphones and Palm needs size to compete with

Nokia

(NOK) - Get Report

,

Apple

(AAPL) - Get Report

and

Research In Motion

( RIMM). The note also estimates that Dell has the $3 billion in cash it would need to pull off the deal.

It's worth noting that there has been long-running speculation that No. 1 PC shop

Hewlett-Packard

(HPQ) - Get Report

, with its ample cash, would also

find Palm a good fit

. But there has been nothing to report on that front.

Sprint and Qwest

Another

familiar potential deal

that simmers and cools on the M&A stove is now simmering again:

Sprint

(S) - Get Report

and

Qwest Communications

(Q)

exploring a long distance joint venture. Qwest's recent inability to sell its national fiber-optic network has reopened the possibility that the Rocky Mountain telco could combine the unit with Sprint's so-called long haul business.

Earlier this week, the

Journal

reported that Sprint was interested in a long-haul combination with

Level 3 Communications

(LVLT)

. But the idea fizzled a bit after observers questioned how a joint venture could

support Level 3's $6.4 billion debt

load. If anything, the report helped smoke out Qwest and its interests in getting out from under the high costs of operating its massive coast-to-coast optical network.

Sprint and Qwest declined to comment.

A best guess is that Sprint will want two-thirds control over the long-haul venture, and Qwest will ruminate for several more months.

Investors were placing some deal bets Friday. Despite a down day in the market, Qwest and Sprint shares were both up about 4% and Level 3 was down about 5%.