VeriFone Systems Third Quarter Earnings Sneak Peek

VeriFone Systems Inc (NYSE:PAY) will unveil its latest earnings on Wednesday, September 5, 2012. VeriFone designs, markets, and services transaction automation systems that enable secure electronic payments among consumers, merchants, and financial institutions.

VeriFone Systems Inc Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 62 cents per share, a rise of 55% from the company’s actual earnings for the same quarter a year ago. The average estimate is the same as three months ago. Between one and three months ago, the average estimate was unchanged. It also has not changed during the last month. Analysts are projecting profit to rise by 45.9% compared to last year’s $2.32.

Past Earnings Performance: The company is looking to beat analyst estimates for the third quarter in a row. Last quarter, it beat estimates with net income of 54 cents per share against the mean estimate of 53 cents. In the prior quarter, the company reported profit of 50 cents.

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Wall St. Revenue Expectations: On average, analysts predict $498.3 million in revenue this quarter, a rise of 57.1% from the year-ago quarter. Analysts are forecasting total revenue of $1.92 billion for the year, a rise of 47.7% from last year’s revenue of $1.3 billion.

A Look Back: In the second quarter, profit fell 42.5% to $14.5 million (13 cents a share) from $25.2 million (27 cents a share) the year earlier, but exceeded analyst expectations. Revenue rose 61.4% to $472 million from $292.4 million.

Stock Price Performance: Between July 3, 2012 and August 29, 2012, the stock price had risen $1.51 (4.6%), from $33.15 to $34.66. The stock price saw one of its best stretches over the last year between January 30, 2012 and February 9, 2012, when shares rose for nine straight days, increasing 19.1% (+$7.53) over that span. It saw one of its worst periods between November 14, 2011 and November 25, 2011 when shares fell for nine straight days, dropping 10.1% (-$4.48) over that span.

Key Stats:

With double-digit revenue growth the past four quarters, this earnings release is a chance to keep that positive trend going. The company has averaged year-over-year revenue growth of 44.8% over the last four quarters.

Analyst Ratings: There are eight out of 13 analysts surveyed (61.5%) rating VeriFone Systems a buy.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.57 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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