Earnings Preview: VeriSign

| About: VeriSign, Inc. (VRSN)

VeriSign (NASDAQ:VRSN) is expected to report Q2 earnings after the market close on Thursday, July 26, with a conference call scheduled for 4:30 pm ET.


The consensus estimate is 45c for EPS and $216.01M for revenue, according to First Call. Analysts are projecting VeriSign to beat estimates after missing them in the previous quarter. 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 13.8% over the last four quarters. Last quarter Verisign Registry Services added 2.86M net new names and ended Q1 with approximately 116.7M active domain names in the adjusted zone for .com and .net, representing an 8.1% increase year-over-year. In Q1, Verisign processed a record 8.9M new domain name registrations, representing an increase of 7.7% year-over-year.

Analyst Views

On July 23, Citigroup downgraded its rating as the stock was approaching its target, and as catalysts played out. The firm cut its estimates as well, as a result of share dilution from the 2007 convert. As usual, the predictable business isn't likely to drive meaningful surprise to estimates, said Citigroup. The firm expects net adds at the low-end of guidance at 1.8M, and notes that trends have slowed slightly below seasonal levels in Q3.

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