When Crystal Balls Aren't Smiling

Don't let people kid you: everything in life is about timing. Everything.

Take, for instance, yesterday's IPO of 'Net telco, Vonage (NYSE-VG). It should have been golden, right? I mean, no matter what everyone is saying now, before the fact, Vonage looked good to go. I certainly thought so. Yet the Holmdel, New Jersey-based company closed out its first day of trading at $17. per share, having gone as low as $14.50 during trading. It was the worst first day performance of an IPO this year to date. That's not good.

On the issue's second day of trading, things got worse: Vonage closed Wednesday at $14.85, pretty close to the day's low of $14.49. And what happens tomorrow? It's anyone's crystal ball, but I'm thinking it'll get worse before it gets better.

Now, today, everyone is talking about stiff competition and Vonage's own pouring money into marketing and -- you know -- blah, blah, blah. You've heard it all before. It's easy to do once the fat lady sings.

But here's the fact: fate had arranged for Vonage's IPO to fall two days into a week that would be full of records for the US markets. And not good ones. Today's session, for instance, was not so hot. According to Forbes, the "Nasdaq Composite finished at its worst level since November 2005, as fears about a slowing economy and interest-rate rises combine to unsettle investors."

There are other factors: continued concern about bird flu, the tanking of the US dollar, and though the US housing market showed a happy upturn today, everyone knows that interest rates, tanking bucks and sick consumers pretty much trump that, or can in short order.

So, for Vonage, call it a bit of bad luck. I'm thinking that, had they managed to IPO at the beginning of May, things would have been better. And -- who knows -- maybe had it been in the September to come, things would have been better still. But in this moment? Call if lady luck or the fall of the cards or whatever you like, but don't try to tell me fate doesn't have a hand in these matters. It has. And it does. And it will.

Oh, yeah: Madeline counseled against it, but I bought some anyway.


Popular Posts