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Will VeriSign (VRSN) Surprise Earnings Estimates in Q4?
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VeriSign Inc. (VRSN - Free Report) is set to report fourth-quarter 2016 results on Feb. 9. In the last quarter, the company reported a positive earnings surprise of 5.06%.
Moreover, we note that VeriSign has underperformed the Zacks categorized Internet Software/Services industry in the last one year. The company’s shares have increased 14.53% compared with the industry’s gain of 40.46% during the period.
Let's see how things are shaping up for this announcement.
Factors at Play
VeriSign holds a prime position in the highly regulated .com and .net domain industry. The renewal of the .com contract and price hikes for the .com and .net domain names will continue to drive VeriSign’s top line. Also, we believe that gTLD prospects, international expansion through IDNs and investments in intellectual properties will boost results. Additionally, VeriSign has significant growth opportunities in the Distributed Denial of Service (DDoS) security market. VeriSign also has significant growth opportunities in the network security products space.
However, the negative impact of search engine adjustments on domain monetization and increasing operating expenses related to marketing remain primary headwinds.
Our proven model does not conclusively show that VeriSign is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here as you will see below:
Zacks ESP: Earnings ESP for VeriSign is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at earnings of 79 cents per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: VeriSign’s Zacks Rank #3 increases the predictive power of ESP. However, we need to have a positive ESP to be confident about an earnings surprise.
We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks That Warrant a Look
Here are a few companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat in their upcoming release:
Activision Blizzard Inc. with an Earnings ESP of +2.78% and a Zacks Rank #3.
Pandora Media Inc. ( with an Earnings ESP of +10. 81% and a Zacks Rank #3.
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Will VeriSign (VRSN) Surprise Earnings Estimates in Q4?
VeriSign Inc. (VRSN - Free Report) is set to report fourth-quarter 2016 results on Feb. 9. In the last quarter, the company reported a positive earnings surprise of 5.06%.
Moreover, we note that VeriSign has underperformed the Zacks categorized Internet Software/Services industry in the last one year. The company’s shares have increased 14.53% compared with the industry’s gain of 40.46% during the period.
Let's see how things are shaping up for this announcement.
Factors at Play
VeriSign holds a prime position in the highly regulated .com and .net domain industry. The renewal of the .com contract and price hikes for the .com and .net domain names will continue to drive VeriSign’s top line. Also, we believe that gTLD prospects, international expansion through IDNs and investments in intellectual properties will boost results. Additionally, VeriSign has significant growth opportunities in the Distributed Denial of Service (DDoS) security market. VeriSign also has significant growth opportunities in the network security products space.
However, the negative impact of search engine adjustments on domain monetization and increasing operating expenses related to marketing remain primary headwinds.
VeriSign, Inc. Price and EPS Surprise
VeriSign, Inc. Price and EPS Surprise | VeriSign, Inc. Quote
Earnings Whispers
Our proven model does not conclusively show that VeriSign is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here as you will see below:
Zacks ESP: Earnings ESP for VeriSign is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at earnings of 79 cents per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: VeriSign’s Zacks Rank #3 increases the predictive power of ESP. However, we need to have a positive ESP to be confident about an earnings surprise.
We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks That Warrant a Look
Here are a few companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat in their upcoming release:
Applied Optoelectronics Inc. (AAOI - Free Report) with an Earnings ESP of +15.87% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Activision Blizzard Inc. with an Earnings ESP of +2.78% and a Zacks Rank #3.
Pandora Media Inc. ( with an Earnings ESP of +10. 81% and a Zacks Rank #3.
Just Released – Driverless Cars: Your Roadmap to Mega-Profits Today
In this latest Special Report, Zacks’ Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making – autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>