NEW YORK (TheStreet) -- Shares of VeriFone Systems Inc  (PAY) were getting a boost, up 1% to $38.55 in early market trading Monday, after analysts at Raymond James raised their rating on the payment solutions company ahead of its earnings report.

The firm raised its rating to "outperform" from "market perform" this morning.

TheStreet's Jim Cramer, Portfolio Manager of the Action Alerts PLUS Charitable Trust Portfolio said on CNBC's Mad Money show last Friday that he's keeping an eye on Verifone's earnings results on Thursday.

San Jose, Calif.-based VeriFone is engaged in the secure electronic payment solutions for the financial, retail, hospitality, petroleum, transportation, government, and healthcare vertical markets.

Separately, TheStreet Ratings team rates VERIFONE SYSTEMS INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate VERIFONE SYSTEMS INC (PAY) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. However, as a counter to these strengths, we find that the company's return on equity has been disappointing."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth greatly exceeded the industry average of 22.5%. Since the same quarter one year prior, revenues rose by 11.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The debt-to-equity ratio is somewhat low, currently at 0.93, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.15, which illustrates the ability to avoid short-term cash problems.
  • 45.55% is the gross profit margin for VERIFONE SYSTEMS INC which we consider to be strong. Regardless of PAY's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, PAY's net profit margin of 2.84% is significantly lower than the industry average.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the IT Services industry and the overall market, VERIFONE SYSTEMS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • You can view the full analysis from the report here: PAY Ratings Report

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