Yesterday we reported on Virgin Mobile USA’s (NYSE: VM) Q4 earning results, and on lower subscribers additions, its stock is being hammered today on NYSE. It fell as much as 54 percent to $2.30 earlier today, and as of this writing is about $2.45…this is still drastically down from its October 2007 IPO price of $15 a share.
Many analysts have also cut the stock rating, reports Reuters. “With 2 quarters in a row of disappointing guidance we believe that the softening economy and increased competition have eliminated management’s ability to forecast its business,” said Bear Stearns analyst Phil Cusick in a client note.
Also, Stanford Group analyst Michael Nelson said he had expected Virgin to add 130,000 customers in the first quarter. “We believe Virgin Mobile is losing share of the prepaid market, owing to intense competition from national and regional carriers,” said Nelson.