VeriSign (VRSN) To Report Q2 Earnings: What's In Store?

VeriSign (NASDAQ:VRSN) is set to report second-quarter 2019 results on Jul 25.

Notably, the company’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average positive surprise being 10.8%.

VeriSign reported first-quarter 2019 non-GAAP earnings of $1.31 per share that beat the Zacks Consensus Estimate of $1.24. The figure increased 22.4% from the year-ago quarter.

Moreover, revenues increased 2.4% year over year to $306.4 million and beat the consensus mark of $302.4 million.

The Zacks Consensus Estimate for second-quarter earnings has been steady at $1.29 over the past 30 days. The consensus mark for revenues is pegged at $306.5 million, indicating an increase of 1.4% from the year-ago quarter’s reported figure.

The consistent increase in the number of .com and .net domain name registrations is likely to drive VeriSign’s top line in the to-be-reported quarter.

Management anticipates the renewal rate for first-quarter 2019 to be about 75% compared with 75.3% in the year-ago quarter. Renewal rates are not fully measurable until 45 days from the end of the quarter.

Moreover, on May 30, 2019, VeriSign announced that first-quarter 2019 closed with 351.8 million domain name registrations across all top-level domains (TLDs), up 0.9% year over year. Domain name registrations grew 18 million or 5.4% year over year.

However, increasing operating expenses related to research and development, and sales and marketing may prove to be a drag on margins in second-quarter 2019.

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has a good chance of beating estimates. The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided.

VeriSign has a Zacks Rank #3 and an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are a few companies you may want to consider, as our model shows that these have the right combination of elements to post earnings beat in their upcoming releases:

Facebook (NASDAQ:FB) has an Earnings ESP of +0.61% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Apple (NASDAQ:AAPL) has an Earnings ESP of +1.35% and a Zacks Rank #3.

Grubhub (NYSE:GRUB) has a Zacks Rank #3 and an Earnings ESP of +23.79%.

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