Vonage Bankers Bent Us Over !!

Posts: 5 · New Forum Member Joined: May 31, 2006 Posts: 5

Vonage Bankers completely screwed us, the small investor and long time Vonage customer. They knew the stock wasn't worth $17 when they dumped it on us. Banks are supposed to support the stock they push/sell at IPO's.

What does that mean? It means they start buying the stock in the open market for the first few days to months to push the stock up and make the IPO successful.

Why do they do this? Because if they have a successful IPO then next time other companies will want to use them for their IPOs and other banking needs. It shows that they bring success to their customers and leads to greater sales and revenues for them. The only time they wouldn't do this is if they know that the stock is very horribly incorrectly priced! And they do know, because they're the ones who do all the analysis and set the price. In these cases, they're willing to throw their reputation out the window because supporting (buying) the stock will cause them to loose a ton of money.

Vonage obviously doesnt give a **** either. They're happy to take our money to the bank.

Posts: 16 · Vonage Forum Associate Joined: May 31, 2006 Posts: 16

GTNator wrote:

Vonage Bankers completely screwed us, the small investor and long time Vonage customer. They knew the stock wasn't worth $17 when they dumped it on us. Banks are supposed to support the stock they push/sell at IPO's.

What does that mean? It means they start buying the stock in the open market for the first few days to months to push the stock up and make the IPO successful.

Why do they do this? Because if they have a successful IPO then next time other companies will want to use them for their IPOs and other banking needs. It shows that they bring success to their customers and leads to greater sales and revenues for them. The only time they wouldn't do this is if they know that the stock is very horribly incorrectly priced! And they do know, because they're the ones who do all the analysis and set the price. In these cases, they're willing to throw their reputation out the window because supporting (buying) the stock will cause them to loose a ton of money.

Vonage obviously doesnt give a **** either. They're happy to take our money to the bank.

You're kidding, right? This is darn close to the dumbest thing I have ever read. And I am no fan of Vonage stock.

Posts: 273 · Vonage Forum Master Joined: Oct 08, 2004 Posts: 273

Dan needs to get in here and clean this sort of stuff up. This topic adds nothing of value which is a hard rule his.

Posts: 16 · Vonage Forum Associate Joined: May 31, 2006 Posts: 16

Nothing of value? While I may not agree with the opinion posted, s/he does have a point of view. Not all readers/posters here are Vonage sycophants.

Posts: 5 · New Forum Member Joined: May 31, 2006 Posts: 5

Although I simplified the process, my point is valid. People in the industry know what I'm talking about. Banks support their IPOs. If you have never heard of this then you don't know much about this industry. period.

Posts: 62 · Full Forum Member Joined: Apr 29, 2005 Posts: 62

OtisABlock wrote:

GTNator wrote:

Vonage Bankers completely screwed us, the small investor and long time Vonage customer. They knew the stock wasn't worth $17 when they dumped it on us. Banks are supposed to support the stock they push/sell at IPO's.

What does that mean? It means they start buying the stock in the open market for the first few days to months to push the stock up and make the IPO successful.

Why do they do this? Because if they have a successful IPO then next time other companies will want to use them for their IPOs and other banking needs. It shows that they bring success to their customers and leads to greater sales and revenues for them. The only time they wouldn't do this is if they know that the stock is very horribly incorrectly priced! And they do know, because they're the ones who do all the analysis and set the price. In these cases, they're willing to throw their reputation out the window because supporting (buying) the stock will cause them to loose a ton of money.

Vonage obviously doesnt give a **** either. They're happy to take our money to the bank.

You're kidding, right? This is darn close to the dumbest thing I have ever read. And I am no fan of Vonage stock.

Why do you think this is stupid? This is the whole theory behind IPO pricing by underwritters. If you think this is stupid, than you obviously have no background in finance. Underwritters are obligated to make a market in the stock for months after the issue, this is a known fact. I can tell you right now it does not appear that they are doing so, as it took me 20 minutes to get filled on a limit sell order that was way below the market price. This order should have been executed right away, if there was no buyer on the market smith barney should have made the market and bought my shares right away.

Posts: 21 · Posted: Fri Jun 02, 2006 3:10 pm Post subject:

No one can tell what happened at the open unless they are or have a stock broker friend. Usually when a company is offering their IPO to their customers it is a danger sign. That means that there might not have been enough interest in their stock. The question here is what made the stock go down? Only a broker can see who was selling shares, especially if they were in large quantities. Hundreds of IPO fall on their face, most of them we never hear about, only the good ones...

Posts: 243 · Vonage Forum Master Joined: Jan 18, 2004 Posts: 243

Not true... I have a TDAmeritrade account that I use for my active trading and I have Level II quotes and I also have access to some incredible live charts. I can see shares in lots as they are being sold/bought, I can see buy/sell trends... all kinds of stuff.

What I observed was the following... When the stock opened it ticked up for about a second then ticked down, then down again... again and again. After about five minutes people simply started to unload the stock left and right. Nobody was buying it was all selling pressure.

I don't think the Underwriters are to blame here because they priced the stock and allocated shares based on the demand. The demand was there but didn't last once some people found that it wasn't going to do a moonshot. The DSP program hurt the stock more than it helped because it brought individual investors into the stock that really had no business being it. They didn't understand fully what they were getting themselves into.

My take is that a number of individuals where in the stock simply to flip it, had it taken off right out of the gate. Since it didn't take off everyone simply sold it as quickly as they could to get out of it.

I also feel that many of those people here who are saying they are not going to pay for their shares are also the ones that were looking to flip at the first decent gain. Since they where not able to secure a quick gain they are looking for excuses to not pay for what they are obligated for.

Posts: 70 · Full Forum Member Joined: Nov 28, 2005 Posts: 70

Pardon my naiviete', but I can't help but think a few things: First, aren't IPO's inherently risky? Second, just about all the pre-IPO info about Vonage was negative - no profits, losing customers, increased competition, and a total emphasis on acquiring more customers over supporting the ones they have (I was in CS, trust me...).

I left Vonage and gave up any chance for stock options.I have no regrets, and that was with a strike price of $5.83, if I recall.

Posts: 476

ckudrna wrote:

Underwritters are obligated to make a market in the stock for months after the issue, this is a known fact.

This is the part I don't understand. The underwriters are responsible for setting the price at what they believe the market will support. They aren't there to prop up the price so that everyone who bought in the IPO makes money.