VeriFone Systems (NYSE: PAY)
VeriFone Systems Earnings & Technicals
After the market closed on Tuesday, VeriFone Systems (PAY) announced second earnings that came up short of analyst estimates along with announcing they will be laying off employees to cut costs, which sent shares plummeting in the post market session. The company announced adjusted earnings per share of 47 cents per share on $526 million in sales while analysts were looking for $52 cents per share on $530 million in sales. Full year guidance was also lowered to the range of $1.85 per share on $2.1 billion in revenues from $2.21 – $2.24 per share on $2.15 – $2.17 billion in revenues. Currently analysts have an average price target of $35.63 but that will most likely be lowered over the coming days as analysts adjust their models.
Looking at the chart you will notice that shares hit premarket lows of $19.50 after closing Tuesday at $28.23 equaling a 31% plummet in prices. Looking for key pivot levels around this price range we’ll have to go back to 2013 when shares were trading around these prices. Look for $18 and $15.34 to act as support levels while resistance will be met at $20.14 and $22 followed up by $25.48. This is a large drop in prices overnight so even though this is bad news for the company we could see shorts taking profits at the open which could drive prices up a little bit so we’ll have to watch price action closely at the open to see where they want to push this stock to.
“Q2 was a mixed quarter for Verifone as we grew our business, but experienced several difficult market dynamics,” said Paul Galant, Chief Executive Officer of Verifone. “As a result, it is necessary for us to adjust for these risks and update our outlook for FY16 to $2.100 billion dollars of revenue and $1.85 of earnings per share. We are aggressively executing mitigating actions including a headcount restructuring and a review of underperforming businesses. At the same time, we remain committed to executing our strategy in a disciplined manner, and continue to make progress in bringing our next generation devices to market and launching our services platform.”
VeriFone Systems, Inc. designs, manufactures, markets, and supplies electronic payment solutions at the point of sale (POS) worldwide. The company offers countertop solutions that accept a range of payment options including contactless, NFC, mobile wallets, and EMV; PIN pads that support credit and debit card, EBT, EMV, and other PIN-based transactions; and multimedia consumer facing POS devices. It also provides portable payment devices comprising small, portable, and handheld devices that enable merchants to accept electronic payments wherever wireless connectivity is available; and mobile solutions that attach to and interface with iOS, Android, or Windows-based smartphones and tablets. In addition, the company offers integrated electronic payment systems that combine electronic payment processing, fuel dispensing, and ECR functions, as well as secure payment systems for integration with petroleum pump controllers; and unattended and self-service payment solutions designed to enable payment transactions in self-service, high-transaction volume, and public transportation environments, as well as network access solutions. Further, it provides payment-as-a-service and other managed, terminal management, payment-enabled media, in-taxi payment, and security solutions; and server-based payment processing software and middleware. Additionally, the company offers installation, deployment, training, and application development and delivery solutions; project management, client education program, and consulting services; and helpdesk support, equipment repair and maintenance, and software post-contract support services, as well as application libraries and development tools. VeriFone Systems, Inc. markets its products directly; and through third party partners. The company was formerly known as VeriFone Holdings, Inc. and changed its name to VeriFone Systems, Inc. in May 2010. VeriFone Systems, Inc. is headquartered in San Jose, California. (YahooFinance)