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VeriFone Systems, Inc. (NYSE:PAY) is scheduled to report its Q3 2012 results on September 5, 2012, after the bell. The Street expects EPS and revenue of $0.70 and $498.37M, respectively.

In this article, I will recap the historical results of the company, its latest EPS estimates vs. surprises, the latest news from PAY and the news from its closest competitors.

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Recent EPS Actuals vs. Estimates

The company has met or beaten analysts' estimates in the last four quarters. In the last quarter, it reported $0.64 EPS, beating analyst estimates of $0.61.

The consensus EPS estimate is $0.70 based on 15 analysts' estimates, up from $0.49 a year ago. Revenue estimates are $498.37M, up from $317.16M a year ago. The median target price by analysts for the stock is $42.00.

Average recommendation: Overweight

Source: Marketwatch

Analyst Upgrades and Downgrades

  • On August 7, 2012, UBS downgraded the company from Buy to Neutral.
  • On July 12, 2012, Compass Point initiated Neutral rating for the company.
  • On June 24, 2012, Hilliard Lyons initiated Long-term Buy rating for the company.
  • On June 18, 2012, UBS upgraded the company from Neutral to Buy.
  • On June 12, 2012, Deutsche Bank reiterated Sell rating for the company.
  • On May 25, 2012, UBS reiterated Neutral rating for the company.
  • On April 29, 2012, Deutsche Bank downgraded the company from Hold to Sell.
  • On April 23, 2012, Barclays reiterated Overweight rating for the company.
  • On March 7, 2012, Argus reiterated Buy rating for the company.

Latest News

  • On August 23, 2012, VeriFone Systems Inc announced that it has received orders to date for 80,000 units of its VX 520 payment solution as banks and merchants seek to meet the requirements of the Central Bank of Nigeria's (CBN) Cash-Less Lagos initiative.
  • On August 20, 2012, VeriFone Systems Inc announced that its Point Group is providing key payment services for the GoMcDo online mobile ordering system utilized by McDonald`s diners in France.
  • On August 13, 2012, VeriFone Systems Inc announced that it has been awarded a contract to supply the Beall's, Inc., retail chain with the recently introduced MX 915, VeriFone's advanced payment and media-enabled solutions system in a space-saving form factor.
  • On July 11, 2012, VeriFone Systems, Inc. announced that it has been awarded a five-year contract by the District of Columbia Taxicab Commission (DCTC) valued from $35 million to as much as $45 million factoring in potential advertising revenue.
  • On March 29, 2012, VeriFone Systems, Inc. announced that for fiscal 2012, it expects revenue to be around $1.92 billion. According to I/B/E/S estimates, analysts were expecting the Company to report revenue of $1.92 billion for fiscal 2012.
  • On March 5, 2012, VeriFone Systems, Inc. announced that for the second quarter of 2012, it expects to report non-GAAP net revenues in the range of $465-$470 million. Non-GAAP net income per diluted share is projected to range from $0.59-$0.60. For fiscal 2012, it expects to report non-GAAP net revenues in the range of $1.900-$1.925 billion.

Competitors

ACI Worldwide (NASDAQ:ACIW), Heartland Payment Systems (NYSE:HPY), NCR Corporation (NYSE:NCR), and Total System Services (NYSE:TSS) are peers for comparison for VeriFone Systems and the table below provides the key metrics for these companies and the industry.

VeriFone Systems, Inc key ratio comparison with direct competitors

The chart below compares the stock price changes as a percentage for the selected companies and S&P 500 index for the last one-year period.

PAY Chart

PAY data by YCharts

Competitors' Latest Development

  • On August 28, 2012, Total System Services Inc announced the opening of a new financial services support centre in Milton Keynes, UK, to better serve the company's growing pan-European client base.
  • On August 13, 2012, Total System Services Inc's Healthcare announced that it has signed an agreement to provide benefit card processing and other services to Acclaris, Inc. The partnership provides solutions for consumer-driven healthcare offerings, flexible spending accounts and other reimbursement account administration for health plans, third-party administrators, outsourced human resource organizations and banks.
  • On August 9, 2012, Total System Services Inc (NASDAQ:TSYS) announced the formation of a joint venture with Central Payment Co. LLC, which will continue to do business under its current name.
  • On July 31, 2012, Heartland Payment Systems Inc announced that the board of directors have declared a quarterly dividend of $0.06 per common share payable September 14, 2012 to shareholders of record on August 24, 2012.
  • On July 31, 2012, Heartland Payment Systems Inc announced that for fiscal 2012, it expect net revenue to be between $540 million and $545 million, and adjusted EPS to be between $1.70 and $1.74, before deducting $0.22 per share of after-tax share-based compensation expense.
  • On July 30, 2012, ACI Worldwide announced about an an agreement first reached earlier this year, with the Agricultural Bank of China to implement ACI Money Transfer System and ACI Proactive Risk Manager as its wholesale payment processing and anti-money laundering solution to facilitate its expansion into the U.S. market.
  • On July 24, 2012, Total System Services Inc announced that it expects that it will achieve the high end of its fiscal 2012 guidance for net income and EPS. According to I/B/E/S Estimates, analysts on an average are expecting the Company to report net income of $243.15 million and EPS of $1.29 for fiscal 2012.
  • On July 19, 2012, NCR Corporation announced that for fiscal 2012, it expects revenues to increase in the range of 11% to 13% on a constant currency basis, income from operations (GAAP) to be $362 million to $377 million, GAAP diluted earnings per share to be in the range of $1.45 to $1.52 and non-GAAP diluted earnings per share (NYSEARCA:EPS) to be in the range of $2.40 to $2.47 per diluted share.
  • On July 19, 2012, SunTrust Bank announced that it is making self-service banking faster and easier for its customers in more than 1,600 locations by deploying new, ATMs from NCR Corporation.
  • On July 19, 2012, Total System Services Inc announced that it has finalized a master services agreement, with a minimum six year term, with Bank of America to provide processing services for its consumer credit card portfolios in the U.S. In addition, TSYS will continue to process Bank of America's commercial credit card portfolios in the U.S. and Internationally.
  • On July 9, 2012, Heartland Payment Systems, Inc. announced that it has acquired LunchByte Systems, Inc., a school foodservice back office management and point-of-sale company led by its NUTRIKIDS.
  • On June 25, 2012, Coinstar, Inc. announced that Redbox Automated Retail, LLC, its wholly owned subsidiary, had completed the acquisition of certain assets of NCR Corp's self-service entertainment DVD kiosk business, including DVD kiosks, DVD inventory, intellectual property, and certain retailer contracts.
  • On June 20, 2012, NCR Corp announced that it has acquired POS Integrated Solutions, a reseller of the NCR Aloha solution for restaurants and Wyse Sistemas de Informática Ltda. provider of software solutions, including the Colibri suite of hospitality software.
  • On May 29, 2012, Total System Services Inc announced that its board of directors has approved a quarterly cash dividend of $0.10 per share on TSYS common stock, payable July 2, 2012, to TSYS shareholders of record as of the close of business on June 21, 2012.
  • On May 3, 2012, ACI Worldwide Inc reiterated annual guidance. Guidance for calendar year 2012 is; revenue to achieve a range of $696-706 million, Operating Income of $99-104 million and Adjusted EBITDA of $165-170 million.
  • On May 1, 2012, Heartland Payment Systems, Inc. announced that the Board of Directors declared a quarterly dividend of $0.06 per common share payable June 15, 2012 to shareholders of record on May 24, 2012.
  • On May 1, 2012, Heartland Payment Systems, Inc. announced that for fiscal 2012, it expects net revenue to be between $530 million and $540 million, and fully diluted Adjusted EPS to be between $1.59 and $1.63, before deducting $0.19 per share of after-tax stock compensation expense.
  • On April 24, 2012, Total System Services, Inc. announced that it continue to believe to achieve guidance of double digit growth in earnings per share and a solid top line revenue increase in 2012.
  • On April 17, 2012, Heartland Payment Systems, Inc. announced that it has signed a three-year contract extension with CITGO Petroleum Corporation to continue authorizing debit and credit card transactions at approximately 6,000 CITGO-branded locations nationwide.
  • On April 16, 2012, NCR Corporation announced that it is raising its guidance for fiscal 2012 and now expects revenues to increase in the range of 11% to 13% on a constant currency basis, income from operations (GAAP) to be $366 million to $381 million, GAAP diluted earnings per share to be in the range of $1.48 to $1.55 and non-GAAP diluted earnings per share to be in the range of $2.40 to $2.47 per diluted share.
  • On April 12, 2012, Total System Services, Inc announced that it has signed a long-term agreement with First Hawaiian Bank to renew its acquirer processing relationship.
  • On April 10, 2012, Total System Services, Inc. announced that it has extended its long-term agreement with Veracity Payment Solutions to serve as their full-service payment solutions provider.
  • On April 5, 2012, Ward/Kraft, Inc announced that it has signed an agreement to license two-sided thermal label intellectual property from NCR Corporation. NCR's 2ST two-sided printing technology improves the efficiency of the direct thermal printing process by allowing simultaneous printing on both the front and back side of a label or other media.

Technical Overview


The stock has a market capitalization of $3.75B and is currently trading at $34.74, with a 52-week range of $30.10-$55.89. The stock's year-to-date performance has been -2.20%. It is currently trading above 20 and 50 SMA, but below 200 SMA.

Sources: Yahoo Finance, Google Finance, Marketwatch, Finviz, Reuters.

Source: Earnings Preview: VeriFone Systems Reports On September 5