Fergie's Tech Blog

Vonage Shares Fall 14% in Market Debut

Christian Plumb writes for Reuters:

Shares of Internet phone service provider Vonage Holdings Corp. fell as much as 14 percent in their market debut on Wednesday on concern about fierce competition and whether the company will ever turn a profit.

The shares were down $2.05 to $14.95 in late-morning trading on the New York Stock Exchange after falling as low as $14.50 earlier in the session.

Vonage has acknowledged it may never be profitable and is viewed with skepticism by many analysts, who cite the growing competition it faces in providing voice-over-Internet protocol (VoIP) services.

"It's very hard to see what their competitive advantage is," said Richard Greenfield, an analyst at Pali Research. "We basically believed, pre-IPO, that the price should be $10 or less."

posted by Fergie @ 5/24/2006 09:52:00 AM