Articles for VeriSign

VeriSign’s Price Hikes Could Curb Demand for .Com & .Net Domains

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Monday, August 16th, 2010 by Trefis Team

VeriSign (NASDAQ:VRSN) holds exclusive rights to register .com and .net Internet domain names, which account for about half of all domain name registrations. The company recently announced that it was raising its prices for .com and .net registrations.

Although these price hikes might benefit VeriSign in the short term, we don’t think they are sustainable. Over time we expect higher prices to reduce demand for .com and .net domains.

Based on this news, along with VeriSign’s second-quarter results and the recent strategic sale of its SSL and authentication business to Symantec, we have reduced the Trefis price estimate for VeriSign’s stock from $35.73 to $35.28. Our analysis follows below. … To read the full article Subscribe to Trefis Pro

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Potential 18% Upside to Dish’s Stock from Higher Pay TV Share, Subscriber Fees

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Thursday, July 29th, 2010 by Trefis Team

Dish Network (NASDAQ:DISH) is the second largest pay-TV provider in the US after satellite rival DirecTV (NASDAQ:DTV). It also competes with AT&T (NYSE:T), Comcast (NASDAQ:CMCSA), Time Warner Cable (NYSE:TWC), and Verizon (NYSE:VZ) in the broader pay-TV market.  We currently have a Trefis price estimate of $27 for Dish Network’s stock, about 32% above the current market price of $20.

Trefis members have created forecasts for two key drivers of Dish Network’s (NASDAQ:DISH) stock over the last week: (1) Dish Network Pay TV Market Share and (2) Fee per Dish Satellite TV Subscriber. The members’ forecast suggest that Dish Network Pay TV Market Share and Fee per Dish Satellite TV Subscriber will trend above the Trefis forecast. Their projections indicate a combined upside of around 18% for our estimate for Dish’s stock.

We estimate Satellite TV constitutes 69% of the $27 Trefis price estimate for Dish’s stock, and hence the stock is quite sensitive to (1) Dish Network Pay TV Market Share and (2) Fee per Dish Satellite TV Subscriber. Below are charts showing recent estimates created by Trefis members for the two drivers in detail.

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Investor Expectations for Key VeriSign Metrics In Line With Forecasts

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Wednesday, July 28th, 2010 by Trefis Team

VeriSign (NASDAQ:VRSN) currently controls the rights to the exclusive registry of .com and .net Internet domain names. The company collects a fixed fee each time individuals or businesses register a new .com or .net domain name, or renew the registration of an existing domain name. We currently have a Trefis price estimate of $36 for VeriSign’s stock, about 24% above the current market price of around $29.

Trefis members have created forecasts for two key drivers of VeriSign’s (NASDAQ:VRSN) stock over the last week: (1) VeriSign Fee for .com / .net Domain Name Purchases & Renewals and (2) Total Number of Internet Domain Names. The member forecasts suggest that VeriSign Fee for .com / .net Domain Name Purchases & Renewals and Total Number of Internet Domain Names will trend mostly in-line with the Trefis forecast. These projections suggest a combined upside of around 1% for VeriSign’s stock.

.com and .net domain names account for around 54% of the $36 Trefis price estimate for VeriSign’s stock. Hence the stock is quite sensitive to (1) VeriSign Fee for .com / .net Domain Name Purchases & Renewals and (2) Total Number of Internet Domain Names. Below are charts showing recent estimates created by Trefis members for the two drivers in detail.

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Higher Expected Mobile CapEx Could Be a Drag on AT&T’s Stock

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Thursday, July 22nd, 2010 by Trefis Team

Trefis members have created forecasts for two key drivers of AT&T’s (NYSE:T) stock over the last week: (1) Mobile CapEx (As % of Mobile Gross Profits) and (2) Mobile Plans & Phones Gross Profit Margin. Their forecasts suggest that Mobile CapEx (As % of Mobile Gross Profits) trends higher than the Trefis forecast, while Mobile Plans & Phones Gross Profit Margin is in line with the Trefis forecast. These projections suggest a combined downside of around 6% for AT&T’s stock.

Mobile Plans & Phones is the most valuable division, constituting 43% of the $38 Trefis price estimate for AT&T’s stock. In comparison, Internet & TV and Phone Landlines account for around 19% and 15%, respectively, of the stock. AT&T primarily competes with Sprint Nextel (NYSE:S) and Verizon (NYSE:VZ) in the mobile phones business.

Given that mobile plans and phones form the core business, AT&T’s stock is quite sensitive to (1) Mobile CapEx (As % of Mobile Gross Profits) and (2) Mobile Plans & Phones Gross Profit Margin. Below are charts showing recent estimates created by Trefis members for the two drivers.

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Court Loss Could Knock 20% off VeriSign’s Stock

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Friday, July 16th, 2010 by Trefis Team

VeriSign (NASDAQ:VRSN), which holds exclusive rights to register .com and .net Internet domain names, is on the verge of losing an antitrust lawsuit filed by Coalition For ICANN Transparency (CFIT), a non-profit organization that represents website owners.

The CFIT case alleges that VeriSign violated U.S. competition law, and seeks to end VeriSign’s monopoly in the domain names market.

A CFIT victory would attract new players to the market, creating competition and forcing domain name prices down. While good for domain name owners, this scenario would pummel VeriSign’s stock value.  Our analysis follows below.

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Best Buy Enters the Media/Telecom Services Market

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Friday, July 2nd, 2010 by Trefis Team

Best Buy (NYSE:BBY) is the largest specialty retailer of consumer electronics in the U.S. It enjoys a market share of more than 22% in the US consumer electronics market, competing primarily with Wal-Mart (NYSE:WMT) and RadioShack (NYSE:RSH).

In addition to consumer electronics, Best Buy increasingly sells media and telecom services. By partnering with Sonic Solutions to sell movie downloads, and with Sprint to offer mobile broadband,  Best Buy signaled its ambition to control the entire consumer electronics chain. Below we discuss possible motives behind Best Buy’s expansion into consumer electronics services.

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New Cloud Storage Software Can Help Symantec’s SaaS Business

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Wednesday, May 19th, 2010 by Trefis Team

Symantec (NASDAQ:SYMC), which competes with McAfee (NYSE:MFE), IBM (NYSE:IBM) and VeriSign (NASDAQ:VRSN) in the Security-as-a-Service (SaaS) segment, recently introduced a new cloud storage platform that supports SaaS services built on its FileStore architecture.  Launched in October 2009, FileStore is the latest scalable file server technology by Symantec that offers higher storage capacity along with more features compared to Symantec’s traditional Cluster File System.

We expect Syamtec’s Consulting & SaaS revenues to more than double over our forecast period and there could be additional upside to the $24 Trefis price estimate for Symantec’s stock if SaaS revenues were to grow more than we forecast as a result of Symantec’s new FileStore services.

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Rebound in Internet Display Ad Market Will Boost VeriSign’s Domain Names Business

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Tuesday, May 18th, 2010 by Trefis Team

Higher demand for the .com and .net domain names offered by VeriSign (NASDAQ:VRSN) is being driven in part by the revival of the internet display ad market.  Recent earnings results from Yahoo (NASDAQ:YHOO) and Google (NASDAQ:GOOG) indicate that a rebound in the display ad market is underway.

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VeriSign Goes After Huge Market with New Trust Seal Service

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Thursday, May 13th, 2010 by Trefis Team

VeriSign’s (NASDAQ:VRSN) Trust Seal service, launched in February 2010, can increase the size of the company’s addressable market by providing non-transactional websites an opportunity to be VeriSign approved and trusted.

VeriSign estimates that the addressable market of non-transactional sites is 10x greater than the addressable market for its SSL certificates used by transactional (e-commerce, banking) sites.

We estimate that VeriSign’s online SSL certificates business currently constitutes about 16% of our estimate for VeriSign’s stock and that the company’s move into non-transactional certification will help VeriSign offset the slowing growth from its SSL certification business.

As a result, there could be additional upside to our $36 Trefis price estimate for VeriSign’s stock if VeriSign’s Trust Seal service were to gain traction.

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VeriSign’s domain name monopoly of gets sweeter

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Wednesday, December 30th, 2009 by Trefis Team

VeriSign recently announced a 7-10% increase in the fees it charges for registering .com and .net domain names.  More than 60% of VeriSign’s value is driven by its registration business and the company’s exclusive right for .com and .net domain registrations.  As a result, its stock is sensitive to changes in the registration fee that VeriSign charges.

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