The recent profit warning and subsequent collapse in the shares of Iona Technologies must have caused particular dismay - and some red faces - at two of Dublin's top stockbroking firms.

Just days before Iona shares plummeted from more than $30 (#28) to less than $15, both Davy and Goodbody Stockbrokers recommended the stock.

"With a solid quarter in prospect, a good strategic outlook and its current valuation relative to its peers and its historic valuation, the stock warrants support at present levels," Davy said in its weekly equity research note.

At the time, Iona was trading at more than $33.

In a note released a few days earlier, Iona's own broker Goodbody maintained its buy recommendation on the stock, noting that the share price, at $37.25, was below the level it was at before the release of fourth quarter results and that it still offered value in comparison to its peers.

The positive broker reports only days before the profit warning seem to suggest that on-going communications between management and the market left something to be desired.

Meantime, clients who took the brokers recommendations and bought in the days before the profit warning must be feeling pretty sore.

Iona has some work to do to repair investor relations and not just on Wall Street.