Vonage (VG) Rating Lowered to Sell at Zacks Investment Research

Vonage (NYSE:VG) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research note issued to investors on Saturday.

According to Zacks, “Vonage is redefining communications by offering consumers and small businesses an affordable alternative to traditional telephone service. The fastest growing telephony company in North America, Vonage’s service area encompasses more than 2000 active rate centers in over 130 global markets. Vonage is sold directly through their website and retail partners such as SAM’s Club, Amazon.com, RadioShack, Best Buy, Circuit City, Staples, Fry’s Electronics and Office Depot. Wholesale partners such as EarthLink, ARMSTRONG(R), Advanced Cable Communications and the Coldwater Board of Public Utilities resell the Vonage broadband phone service under their own unique brands. With more than 300,000 lines in service, Vonage continues to add more than 30,000 lines per month to its network. Over 10 million calls per week are made using Vonage, the easy-to-use, feature-rich, flat rate phone service. “

A number of other research analysts have also issued reports on the company. William Blair reiterated an “outperform” rating on shares of Vonage in a research report on Monday, September 24th. Needham & Company LLC reiterated a “buy” rating and set a $15.00 target price (up previously from $13.00) on shares of Vonage in a research report on Wednesday, August 1st. Finally, Citigroup increased their target price on Vonage to $16.00 and gave the company a “buy” rating in a research report on Monday, July 16th. They noted that the move was a valuation call. One equities research analyst has rated the stock with a sell rating, one has given a hold rating, four have given a buy rating and one has given a strong buy rating to the stock. Vonage has a consensus rating of “Buy” and a consensus target price of $14.00.

Shares of NYSE:VG traded down $0.47 during midday trading on Friday, reaching $11.22. 2,791,331 shares of the company’s stock traded hands, compared to its average volume of 2,134,686. Vonage has a 1 year low of $8.65 and a 1 year high of $14.73. The firm has a market capitalization of $2.81 billion, a price-to-earnings ratio of 40.07, a price-to-earnings-growth ratio of 7.14 and a beta of -0.02. The company has a debt-to-equity ratio of 0.37, a current ratio of 0.75 and a quick ratio of 0.73.

Vonage (NYSE:VG) last announced its earnings results on Friday, November 2nd. The technology company reported $0.09 earnings per share (EPS) for the quarter, meeting analysts’ consensus estimates of $0.09. Vonage had a positive return on equity of 17.66% and a negative net margin of 1.22%. The firm had revenue of $261.53 million for the quarter, compared to analyst estimates of $263.91 million. During the same quarter last year, the firm posted $0.07 EPS. The business’s revenue was up 3.3% on a year-over-year basis. On average, sell-side analysts expect that Vonage will post 0.35 earnings per share for the current year.

In related news, Director Jeffrey A. Citron sold 500,000 shares of the stock in a transaction on Thursday, September 13th. The stock was sold at an average price of $14.33, for a total value of $7,165,000.00. Following the completion of the transaction, the director now directly owns 10,650,784 shares of the company’s stock, valued at approximately $152,625,734.72. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, CFO David T. Pearson sold 159,000 shares of the stock in a transaction on Friday, September 21st. The shares were sold at an average price of $13.48, for a total value of $2,143,320.00. Following the completion of the transaction, the chief financial officer now directly owns 255,009 shares of the company’s stock, valued at $3,437,521.32. The disclosure for this sale can be found here. Insiders have sold a total of 2,345,329 shares of company stock worth $32,961,939 in the last quarter. Insiders own 8.70% of the company’s stock.

A number of hedge funds and other institutional investors have recently bought and sold shares of the stock. New York State Teachers Retirement System raised its stake in Vonage by 2.6% in the 2nd quarter. New York State Teachers Retirement System now owns 156,947 shares of the technology company’s stock valued at $2,023,000 after purchasing an additional 3,974 shares during the last quarter. Marshall Wace LLP raised its stake in Vonage by 9.8% in the 2nd quarter. Marshall Wace LLP now owns 45,220 shares of the technology company’s stock valued at $583,000 after purchasing an additional 4,032 shares during the last quarter. OppenheimerFunds Inc. raised its stake in Vonage by 7.4% in the 2nd quarter. OppenheimerFunds Inc. now owns 62,648 shares of the technology company’s stock valued at $808,000 after purchasing an additional 4,302 shares during the last quarter. D.A. Davidson & CO. raised its stake in Vonage by 5.6% in the 2nd quarter. D.A. Davidson & CO. now owns 82,182 shares of the technology company’s stock valued at $1,059,000 after purchasing an additional 4,377 shares during the last quarter. Finally, Arizona State Retirement System increased its stake in shares of Vonage by 1.4% in the 3rd quarter. Arizona State Retirement System now owns 319,044 shares of the technology company’s stock worth $4,518,000 after acquiring an additional 4,458 shares during the last quarter. 85.29% of the stock is owned by hedge funds and other institutional investors.

About Vonage

Vonage Holdings Corp. provides communications services connecting people through cloud-connected devices worldwide. It offers various business services, including basic dial tone, call queue, conferencing, call groups, mobile functionality, CRM integration, and detailed analytics, as well as Vonage Business Cloud and Vonage Enterprise services.

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