VeriFone Systems (PAY) Concerns Overdone - Goldman

With shares 40 percent below 52-week highs near $55, clearly 2012 was not a good year for VeriFone Systems, Inc. (NYSE: PAY) investors. The decline in VeriFone stock can be traced back to a crisis of confidence among investors who fear a rapid transition to mobile payments will create secular headwinds for the point of sale payment solutions provider. In the view of Goldman Sachs analyst Julio C. Quinteros Jr., those fears are overstated.

"While we see some new entrants as potential long-term threats, we believe obsolescence concerns are overdone given the recent industry push to bring chip-based cards (i.e., EMV) into the US, and efforts to integrate mobile payment technology into existing infrastructure. Additionally, PAY has a full suite of products to compete with new entrants, which we believe enhances the company's overall competitive positioning." said Quintero.

VeriFone also has plenty of opportunity in emerging markets, thinks Goldman Sachs.

"Over the long-term, we remain focused PAY's dominant market share in emerging markets, as we see the continued ascent of a new middle/wealth class and deployment of new payment technologies as key demand drivers," continued Quintero.

Investors will get a fresh look into PAY's business when it reports Q4 earnings on December 13th. Street estimates call for revenue and EPS of $495 million and EPS of 76 cents.

Goldman Sachs has a Buy rating on VeriFone (NYSE: PAY) with a price target of $43.00.

For an analyst ratings summary and ratings history on VeriFone click here. For more ratings news on VeriFone click here.

Shares of VeriFone closed at $32.56 yesterday.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Antero Midstream Partners LP (AM) PT Raised to $24 at Goldman Sachs into earnings
• Citi Reiterates Buy Rating on Estee Lauder (EL), Adding Upside 90-Day Catalyst Watch
• Morgan Stanley Downgrades Tryg A/S (TRYG:DC) (TGVSF) to Underweight