We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
What's in Store for VeriFone System (PAY) in Q1 Earnings?
Read MoreHide Full Article
VeriFone Systems Inc. (PAY - Free Report) is set to report fiscal first-quarter 2018 results on Mar 8.
In the last quarter, the company’s non-GAAP earnings of 44 cents per share beat the Zacks Consensus Estimate by a penny and surged 47.7% from the year-ago quarter.
In the trailing four quarters, the company surpassed the Zacks Consensus Estimate once while matched the same on the other three occasions, delivering an average positive surprise of 0.58%.
Non-GAAP revenues increased 2.6% year over year to $476.5 million and beat the Zacks Consensus Estimate of $472 million.
However, a soft guidance for the upcoming quarterly results makes us skeptical. For first-quarter fiscal 2018, VeriFone projects non-GAAP revenues between $418 million and $420 million, adjusted to exclude divested business.
Notably, VeriFone’s shares have lost 14.3% in the past year as compared with the industry’s growth of 34.2%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
VeriFone enjoys a premium position in the electronic payment systems and services market. Increasing demand for Point-of-Sale (POS) software and Payment-as-a Service technologies is a key catalyst.
VeriFone’s strong product portfolio which includes the likes of Carbon 8 and Engage are driving growth in the global market, particularly in Latin America and Europe, Middle East and Africa (EMEA).
The company’s mPOS device gained traction within a short span of time. In the quarter, VeriFone announced implementation of Mastercard’s M/Chip Fast technology across its payment solutions to enable faster checkout for EMV transactions. The company also extended global partnership with Alipay, which enables select Lacoste U.S. stores to accept Alipay.
However, management anticipates revenues in the Asia Pacific region to decline year over year. This is due to tough year-over-year comparison as in the first quarter of fiscal 2017, the company benefitted largely from sudden robust demand in India, courtesy of demonetization.
Additionally, the company’s divestitures of Petro Media and the Taxi businesses are expected to dent the top line in North America.
Nonetheless, the divestitures of the company’s non-core business are likely to have a positive impact on margins.
According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or #3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. The Sell-rated stocks (Zacks Rank #4 or #5) are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
VeriFone has an Earnings ESP of -2.22% and a Zacks Rank #4. Therefore, our proven model does not show that the company is likely to deliver a positive surprise this quarter.
Stocks With a Favorable Combination
Here are some companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter.
Autodesk Inc (ADSK - Free Report) has an Earnings ESP of +8.70% and a Zacks Rank #3.
Tech Data Corporation has an Earnings ESP of +0.28% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
What's in Store for VeriFone System (PAY) in Q1 Earnings?
VeriFone Systems Inc. (PAY - Free Report) is set to report fiscal first-quarter 2018 results on Mar 8.
In the last quarter, the company’s non-GAAP earnings of 44 cents per share beat the Zacks Consensus Estimate by a penny and surged 47.7% from the year-ago quarter.
In the trailing four quarters, the company surpassed the Zacks Consensus Estimate once while matched the same on the other three occasions, delivering an average positive surprise of 0.58%.
Non-GAAP revenues increased 2.6% year over year to $476.5 million and beat the Zacks Consensus Estimate of $472 million.
However, a soft guidance for the upcoming quarterly results makes us skeptical. For first-quarter fiscal 2018, VeriFone projects non-GAAP revenues between $418 million and $420 million, adjusted to exclude divested business.
Notably, VeriFone’s shares have lost 14.3% in the past year as compared with the industry’s growth of 34.2%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
VeriFone enjoys a premium position in the electronic payment systems and services market. Increasing demand for Point-of-Sale (POS) software and Payment-as-a Service technologies is a key catalyst.
VeriFone’s strong product portfolio which includes the likes of Carbon 8 and Engage are driving growth in the global market, particularly in Latin America and Europe, Middle East and Africa (EMEA).
The company’s mPOS device gained traction within a short span of time. In the quarter, VeriFone announced implementation of Mastercard’s M/Chip Fast technology across its payment solutions to enable faster checkout for EMV transactions. The company also extended global partnership with Alipay, which enables select Lacoste U.S. stores to accept Alipay.
However, management anticipates revenues in the Asia Pacific region to decline year over year. This is due to tough year-over-year comparison as in the first quarter of fiscal 2017, the company benefitted largely from sudden robust demand in India, courtesy of demonetization.
Additionally, the company’s divestitures of Petro Media and the Taxi businesses are expected to dent the top line in North America.
Nonetheless, the divestitures of the company’s non-core business are likely to have a positive impact on margins.
Verifone Systems, Inc. Price and EPS Surprise
Verifone Systems, Inc. Price and EPS Surprise | Verifone Systems, Inc. Quote
What Our Model Says
According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or #3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. The Sell-rated stocks (Zacks Rank #4 or #5) are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
VeriFone has an Earnings ESP of -2.22% and a Zacks Rank #4. Therefore, our proven model does not show that the company is likely to deliver a positive surprise this quarter.
Stocks With a Favorable Combination
Here are some companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter.
CSG Systems International Inc. (CSGS - Free Report) has an Earnings ESP of +2.94% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Autodesk Inc (ADSK - Free Report) has an Earnings ESP of +8.70% and a Zacks Rank #3.
Tech Data Corporation has an Earnings ESP of +0.28% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>