Vonage shares were falling 22 cents, or 11%, to $1.78. Earlier, the stock touched an intraday low of $1.73. More than 19 million shares changed hands in the first hour of trading Thursday, compared to the stock's three-month average daily volume of 10.5 million, according to Yahoo! Finance.
Vonage Monday surged nearly 13% after the company announced the launch of Vonage Mobile, a mobile calling application for the Apple (AAPL - Get Report) iPhone and iPod touch and Research in Motion's (RIMM) BlackBerry.
On Wednesday, Vonage shares jumped nearly 40% on volume that topped 95 million shares to close at $2 after Citigroup increased its stock price target for the company to $1.50 from 50 cents. The firm maintained its hold rating, but said Vonage's decision to bring its product to smartphones may provide a new revenue source.Vonage has a 79.5 million-share float with a short interest float of 9.6% as of Sept. 10, according to Yahoo! Finance. More than 48% of the company's shares are held by insiders and another 15% is held by institutions. Investor posts on Internet message boards called Thursday's decline another sign that Vonage shares are the victim of typical pump-and-dump action. Others argued that Thursday's 11% decline is merely profit taking after the recent run up in shares. Bullish investors argued the pullback offers an attractive entry point for the stock, as they expect a bounce later Thursday. Read more about today's high-volume stocks in earlier "Pump Up the Volume" posts. -- Written by Robert Holmes in New York.