VERISIGN INC (VRSN) Stock Fundamental Analysis
NASDAQ:VRSN - Nasdaq - US92343E1029 - Common Stock - Currency: USD
VRSN gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 81 industry peers in the IT Services industry. VRSN has a medium profitability rating, but doesn't score so well on its financial health evaluation. While showing a medium growth rate, VRSN is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
VRSN had positive earnings in the past year.
In the past year VRSN had a positive cash flow from operations.
VRSN had positive earnings in each of the past 5 years.
In the past 5 years VRSN always reported a positive cash flow from operatings.
1.2 Ratios
VRSN has a Return On Assets of 55.86%. This is amongst the best in the industry. VRSN outperforms 100.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 55.86% | ||
| ROE | N/A | ||
| ROIC | N/A |
ROA(3y)47.16%
ROA(5y)45.43%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Profit Margin, with a value of 50.45%, VRSN belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
VRSN's Profit Margin has been stable in the last couple of years.
Looking at the Operating Margin, with a value of 67.95%, VRSN belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
In the last couple of years the Operating Margin of VRSN has remained more or less at the same level.
VRSN has a better Gross Margin (87.71%) than 97.53% of its industry peers.
In the last couple of years the Gross Margin of VRSN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 67.95% | ||
| PM (TTM) | 50.45% | ||
| GM | 87.71% |
OM growth 3Y1.34%
OM growth 5Y0.75%
PM growth 3Y-5.15%
PM growth 5Y0.3%
GM growth 3Y0.84%
GM growth 5Y0.55%
2. Health
2.1 Basic Checks
VRSN does not have a ROIC to compare to the WACC, probably because it is not profitable.
Compared to 1 year ago, VRSN has less shares outstanding
Compared to 5 years ago, VRSN has less shares outstanding
Compared to 1 year ago, VRSN has a worse debt to assets ratio.
2.2 Solvency
VRSN has an Altman-Z score of -5.64. This is a bad value and indicates that VRSN is not financially healthy and even has some risk of bankruptcy.
VRSN's Altman-Z score of -5.64 is on the low side compared to the rest of the industry. VRSN is outperformed by 88.89% of its industry peers.
VRSN has a debt to FCF ratio of 2.05. This is a good value and a sign of high solvency as VRSN would need 2.05 years to pay back of all of its debts.
VRSN's Debt to FCF ratio of 2.05 is fine compared to the rest of the industry. VRSN outperforms 69.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 2.05 | ||
| Altman-Z | -5.64 |
ROIC/WACCN/A
WACC10.36%
2.3 Liquidity
A Current Ratio of 0.43 indicates that VRSN may have some problems paying its short term obligations.
The Current ratio of VRSN (0.43) is worse than 92.59% of its industry peers.
A Quick Ratio of 0.43 indicates that VRSN may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.43, VRSN is doing worse than 91.36% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.43 | ||
| Quick Ratio | 0.43 |
3. Growth
3.1 Past
VRSN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.50%, which is quite good.
Measured over the past years, VRSN shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.54% on average per year.
Looking at the last year, VRSN shows a small growth in Revenue. The Revenue has grown by 4.31% in the last year.
Measured over the past years, VRSN shows a small growth in Revenue. The Revenue has been growing by 4.80% on average per year.
EPS 1Y (TTM)10.5%
EPS 3Y13.17%
EPS 5Y8.54%
EPS Q2Q%4.17%
Revenue 1Y (TTM)4.31%
Revenue growth 3Y5.47%
Revenue growth 5Y4.8%
Sales Q2Q%3.94%
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 10.78% on average per year.
The Revenue is expected to grow by 5.26% on average over the next years.
EPS Next Y10.95%
EPS Next 2Y8.24%
EPS Next 3Y10.35%
EPS Next 5Y10.78%
Revenue Next Year4.28%
Revenue Next 2Y2.7%
Revenue Next 3Y4.69%
Revenue Next 5Y5.26%
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.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 30.06, VRSN can be considered very expensive at the moment.
VRSN's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of VRSN to the average of the S&P500 Index (29.35), we can say VRSN is valued inline with the index average.
With a Price/Forward Earnings ratio of 27.09, VRSN can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Forward Earnings ratio of VRSN is on the same level as its industry peers.
VRSN is valuated rather expensively when we compare the Price/Forward Earnings ratio to 22.10, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.06 | ||
| Fwd PE | 27.09 |
4.2 Price Multiples
VRSN's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, VRSN is valued a bit cheaper than 60.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.01 | ||
| EV/EBITDA | 21.5 |
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 a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.74
PEG (5Y)3.52
EPS Next 2Y8.24%
EPS Next 3Y10.35%
5. Dividend
5.1 Amount
VRSN does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
240.47
+0.53 (+0.22%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners82.02%
Inst Owner Change0.21%
Ins Owners0.7%
Ins Owner Change3.89%
Market Cap22.75B
Analysts80
Price Target241.78 (0.54%)
Short Float %1.89%
Short Ratio1.94
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.57%
Min EPS beat(2)-2.11%
Max EPS beat(2)0.97%
EPS beat(4)3
Avg EPS beat(4)0.51%
Min EPS beat(4)-2.11%
Max EPS beat(4)1.94%
EPS beat(8)5
Avg EPS beat(8)0.24%
EPS beat(12)7
Avg EPS beat(12)0.15%
EPS beat(16)10
Avg EPS beat(16)0.14%
Revenue beat(2)0
Avg Revenue beat(2)-1.85%
Min Revenue beat(2)-1.85%
Max Revenue beat(2)-1.85%
Revenue beat(4)0
Avg Revenue beat(4)-1.67%
Min Revenue beat(4)-1.85%
Max Revenue beat(4)-1.33%
Revenue beat(8)0
Avg Revenue beat(8)-1.84%
Revenue beat(12)0
Avg Revenue beat(12)-1.63%
Revenue beat(16)0
Avg Revenue beat(16)-1.66%
PT rev (1m)3.95%
PT rev (3m)17.32%
EPS NQ rev (1m)1.4%
EPS NQ rev (3m)1.67%
EPS NY rev (1m)0.59%
EPS NY rev (3m)0.6%
Revenue NQ rev (1m)0.99%
Revenue NQ rev (3m)1.25%
Revenue NY rev (1m)0.67%
Revenue NY rev (3m)0.79%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.06 | ||
| Fwd PE | 27.09 | ||
| P/S | 14.61 | ||
| P/FCF | 26.01 | ||
| P/OCF | 25.2 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.5 |
EPS(TTM)8
EY3.33%
EPS(NY)8.88
Fwd EY3.69%
FCF(TTM)9.24
FCFY3.84%
OCF(TTM)9.54
OCFY3.97%
SpS16.46
BVpS-20.7
TBVpS-21.25
PEG (NY)2.74
PEG (5Y)3.52
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 55.86% | ||
| ROE | N/A | ||
| ROCE | -849.28% | ||
| ROIC | N/A | ||
| ROICexc | N/A | ||
| ROICexgc | N/A | ||
| OM | 67.95% | ||
| PM (TTM) | 50.45% | ||
| GM | 87.71% | ||
| FCFM | 56.15% |
ROA(3y)47.16%
ROA(5y)45.43%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)-172.55%
ROCE(5y)-63.29%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y1.34%
OM growth 5Y0.75%
PM growth 3Y-5.15%
PM growth 5Y0.3%
GM growth 3Y0.84%
GM growth 5Y0.55%
F-Score7
Asset Turnover1.11
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 2.05 | ||
| Debt/EBITDA | 1.36 | ||
| Cap/Depr | 76.15% | ||
| Cap/Sales | 1.8% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 82.42% | ||
| Profit Quality | 111.3% | ||
| Current Ratio | 0.43 | ||
| Quick Ratio | 0.43 | ||
| Altman-Z | -5.64 |
F-Score7
WACC10.36%
ROIC/WACCN/A
Cap/Depr(3y)79.48%
Cap/Depr(5y)88.52%
Cap/Sales(3y)2.26%
Cap/Sales(5y)2.84%
Profit Quality(3y)109.8%
Profit Quality(5y)101.96%
High Growth Momentum
Growth
EPS 1Y (TTM)10.5%
EPS 3Y13.17%
EPS 5Y8.54%
EPS Q2Q%4.17%
EPS Next Y10.95%
EPS Next 2Y8.24%
EPS Next 3Y10.35%
EPS Next 5Y10.78%
Revenue 1Y (TTM)4.31%
Revenue growth 3Y5.47%
Revenue growth 5Y4.8%
Sales Q2Q%3.94%
Revenue Next Year4.28%
Revenue Next 2Y2.7%
Revenue Next 3Y4.69%
Revenue Next 5Y5.26%
EBIT growth 1Y5.76%
EBIT growth 3Y6.88%
EBIT growth 5Y5.59%
EBIT Next Year10%
EBIT Next 3Y3.72%
EBIT Next 5Y7.12%
FCF growth 1Y8.23%
FCF growth 3Y5.06%
FCF growth 5Y4.15%
OCF growth 1Y5.72%
OCF growth 3Y3.79%
OCF growth 5Y3.67%