What The Heck Is Up With Micro Cap Telecom Stocks?

So, I’ve been writing a lot the last few days about the stunning run-up in shares of Vonage (VG).

But it isn’t just Vonage. A whole bunch of micro-cap telecom stocks are on a tear for reasons that so far are not entirely clear to me. Consider this list:

• NextWave (WAVE) today rose $1.02, or 242% - 242%! - to $1.44, on volume of 26.5 million shares. Average volume: 768,000 shares. The stock actually started to run up earlier in the week. Three-day run: 324%.


• FiberTower (FTWR) today rose 10 cents, or 17%, to 69 cents, on 5.6 million shares. Average volume: 887,000 shares. Three-day move: 53%.
  
  


• Fairpoint Communications (FRP) today rose 15 cents, or 32.6%, to 61 cents, on 9.6 million shares. Average volume: 1.5 million shares, The stock is up another 21 cents, or 34%, after hours, for a total move today alone of 78%.
  
  


• Zhone Technologies (ZHNE) today rose 20 cents, or 43.5%, to 66 cents on volume of 4 million shares. Average volume:259,000 shares. Four-day move: 78%. And the stock is up another 9 cents, or 13.6%, in late trading.

As for Vonage, the stock today rose 58 cents, or 36.5%, to $2.17. That’s after a rally of 99 cents, or 165% yesterday. Seven-day rally: 471%. And after hours, the stock is up another 12 cents, or 5.5%, to $2.29. Volume in VG today hit an astonishing 80.88 million shares, move than half the company’s outstanding shares, and roughly equal to the entire float.

Why are investors in obscure micro cap telecom stocks trading like its 1999? Theories welcome.