Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B-. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, revenue growth, expanding profit margins 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.
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Highlights from the ratings report include:
- VERISIGN INC has improved earnings per share by 26.8% 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 $1.91 versus $0.84 in the prior year. This year, the market expects an improvement in earnings ($2.25 versus $1.91).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Internet Software & Services industry average. The net income increased by 24.3% when compared to the same quarter one year prior, going from $68.01 million to $84.51 million.
- VRSN's revenue growth trails the industry average of 31.4%. Since the same quarter one year prior, revenues rose by 14.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The gross profit margin for VERISIGN INC is currently very high, coming in at 86.40%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 35.74% significantly outperformed against the industry average.
- Net operating cash flow has increased to $150.64 million or 36.59% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -1.16%.
VeriSign, Inc. provides Internet infrastructure services worldwide. It offers registry services that operate the authoritative directory of .com, .net, .cc, .tv, and .name domain names, as well as the back-end systems for various .gov, .jobs, and .edu domain names. VeriSign has a market cap of $6.6 billion and is part of the technology sector and computer software & services industry. The company has a P/E ratio of 22.00, above the S&P 500 P/E ratio of 18.00. Shares are up 13.8% year to date as of the close of trading on Friday.
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--Written by a member of TheStreet Ratings Staff.
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