VERISIGN INC (VRSN)
US92343E1029 - Common Stock
Overall VRSN gets a fundamental rating of 5 out of 10. We evaluated VRSN against 83 industry peers in the IT Services industry. VRSN scores excellent on profitability, but there are concerns on its financial health. VRSN has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year VRSN was profitable.
VRSN had a positive operating cash flow in the past year.
Each year in the past 5 years VRSN has been profitable.
Each year in the past 5 years VRSN had a positive operating cash flow.
1.2 Ratios
VRSN has a Return On Assets of 58.75%. This is amongst the best in the industry. VRSN outperforms 100.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for VRSN is significantly above the industry average of 9.57%.
The last Return On Invested Capital (%ROIC%%) for VRSN is well below the 3 year average (114.03%), which needs to be investigated, but indicates that VRSN had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 58.75% | ||
| ROE | N/A | ||
| ROIC | N/A |
ROA(3y)41.73%
ROA(5y)40.87%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)114.03%
ROIC(5y)99.93%
1.3 Margins
VRSN has a Profit Margin of 55.69%. This is amongst the best in the industry. VRSN outperforms 100.00% of its industry peers.
In the last couple of years the Profit Margin of VRSN has grown nicely.
Looking at the Operating Margin, with a value of 68.12%, VRSN belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
VRSN's Operating Margin has been stable in the last couple of years.
VRSN has a better Gross Margin (87.58%) than 97.53% of its industry peers.
VRSN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 68.12% | ||
| PM (TTM) | 55.69% | ||
| GM | 87.58% |
OM growth 3Y0.95%
OM growth 5Y1.19%
PM growth 3Y-5.27%
PM growth 5Y2.69%
GM growth 3Y0.4%
GM growth 5Y0.61%
2. Health
2.1 Basic Checks
VRSN has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
VRSN has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, VRSN has less shares outstanding
The debt/assets ratio for VRSN has been reduced compared to a year ago.
2.2 Solvency
VRSN has an Altman-Z score of -6.20. This is a bad value and indicates that VRSN is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of -6.20, VRSN is not doing good in the industry: 91.36% of the companies in the same industry are doing better.
The Debt to FCF ratio of VRSN is 2.10, which is a good value as it means it would take VRSN, 2.10 years of fcf income to pay off all of its debts.
VRSN's Debt to FCF ratio of 2.10 is fine compared to the rest of the industry. VRSN outperforms 67.90% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 2.1 | ||
| Altman-Z | -6.2 |
ROIC/WACCN/A
WACC10.9%
2.3 Liquidity
A Current Ratio of 0.47 indicates that VRSN may have some problems paying its short term obligations.
VRSN has a worse Current ratio (0.47) than 95.06% of its industry peers.
A Quick Ratio of 0.47 indicates that VRSN may have some problems paying its short term obligations.
VRSN has a Quick ratio of 0.47. This is amonst the worse of the industry: VRSN underperforms 95.06% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.47 | ||
| Quick Ratio | 0.47 |
3. Growth
3.1 Past
VRSN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 12.82%, which is quite good.
The Earnings Per Share has been growing slightly by 7.43% on average over the past years.
Looking at the last year, VRSN shows a small growth in Revenue. The Revenue has grown by 4.08% in the last year.
The Revenue has been growing slightly by 4.21% on average over the past years.
EPS 1Y (TTM)12.82%
EPS 3Y7.8%
EPS 5Y7.43%
EPS Q2Q%13.11%
Revenue 1Y (TTM)4.08%
Revenue growth 3Y5.68%
Revenue growth 5Y4.21%
Sales Q2Q%3.8%
3.2 Future
Based on estimates for the next years, VRSN will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.02% on average per year.
VRSN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.25% yearly.
EPS Next Y12.99%
EPS Next 2Y10.4%
EPS Next 3Y8.86%
EPS Next 5Y11.02%
Revenue Next Year4.4%
Revenue Next 2Y3.93%
Revenue Next 3Y3.31%
Revenue Next 5Y5.25%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 24.20 indicates a rather expensive valuation of VRSN.
64.20% of the companies in the same industry are more expensive than VRSN, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 29.55. VRSN is around the same levels.
VRSN is valuated rather expensively with a Price/Forward Earnings ratio of 21.72.
Based on the Price/Forward Earnings ratio, VRSN is valued a bit cheaper than 65.43% of the companies in the same industry.
VRSN's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.22.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.2 | ||
| Fwd PE | 21.72 |
4.2 Price Multiples
VRSN's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. VRSN is cheaper than 65.43% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, VRSN is valued a bit cheaper than 67.90% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.62 | ||
| EV/EBITDA | 17.61 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates VRSN does not grow enough to justify the current Price/Earnings ratio.
VRSN has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.86
PEG (5Y)3.26
EPS Next 2Y10.4%
EPS Next 3Y8.86%
5. Dividend
5.1 Amount
VRSN does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
VERISIGN INC
NASDAQ:VRSN (11/27/2024, 9:13:41 PM)
After market: 191.63 0 (0%)191.63
+6.47 (+3.49%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap18.42B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS beat(16)
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PT rev (1m)
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EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.2 | ||
| Fwd PE | 21.72 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.86
PEG (5Y)3.26
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 58.75% | ||
| ROE | N/A | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 68.12% | ||
| PM (TTM) | 55.69% | ||
| GM | 87.58% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.05
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.47 | ||
| Quick Ratio | 0.47 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)12.82%
EPS 3Y7.8%
EPS 5Y
EPS Q2Q%
EPS Next Y12.99%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)4.08%
Revenue growth 3Y5.68%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y