Rating Change #5
VeriSign Inc (VRSN) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, increase in net income, revenue growth and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
Highlights from the ratings report include:
- Despite the fact that VRSN's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.07 is high and demonstrates strong liquidity.
- VERISIGN INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, VERISIGN INC increased its bottom line by earning $0.84 versus $0.38 in the prior year. This year, the market expects an improvement in earnings ($1.86 versus $0.84).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Internet Software & Services industry. The net income increased by 232.8% when compared to the same quarter one year prior, rising from -$40.51 million to $53.81 million.
- VRSN's revenue growth trails the industry average of 25.8%. Since the same quarter one year prior, revenues rose by 13.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Net operating cash flow has significantly increased by 165.82% to $124.21 million when compared to the same quarter last year. In addition, VERISIGN INC has also vastly surpassed the industry average cash flow growth rate of 11.56%.
VeriSign, Inc. provides Internet infrastructure services to various networks worldwide. The company provides domain name registry services and infrastructure assurance services. The company has a P/E ratio of 95.8, below the average computer software & services industry P/E ratio of 101.4 and above the S&P 500 P/E ratio of 17.7. VeriSign has a market cap of $5.81 billion and is part of the technology sector and computer software & services industry. Shares are up 0.6% year to date as of the close of trading on Friday.You can view the full VeriSign Ratings Report or get investment ideas from our investment research center.
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