VeriSign (NASDAQ:VRSN) Shares Gap Down - Time to Sell?

Key Points

• VeriSign's shares gapped down significantly, opening at $288.00 compared to the previous close of $305.98, and last traded at $284.94 amid a volume of 694,480 shares.
• The company recently declared a quarterly dividend of $0.77, resulting in an annualized dividend yield of 1.11%, while also announcing a share repurchase plan worth $1.11 billion.
• Despite a negative return on equity of 40.87%, VeriSign reported a slight revenue increase of 5.9% year-over-year, with quarterly earnings of $2.21 EPS exceeding analysts' expectations.

VeriSign, Inc. (NASDAQ:VRSN - Get Free Report) gapped down before the market opened on Tuesday . The stock had previously closed at $305.98, but opened at $288.00. VeriSign shares last traded at $284.94, with a volume of 694,480 shares trading hands.

Analyst Upgrades and Downgrades

VRSN has been the subject of a number of recent analyst reports. Wall Street Zen raised VeriSign from a "hold" rating to a "buy" rating in a research report on Saturday, April 12th. Citigroup reaffirmed a "buy" rating on shares of VeriSign in a research report on Tuesday, July 8th. Finally, Robert W. Baird lifted their price target on VeriSign from $285.00 to $305.00 and gave the stock an "outperform" rating in a report on Tuesday, July 1st.

VeriSign Price Performance

The firm has a fifty day simple moving average of $281.89 and a 200-day simple moving average of $256.87. The firm has a market cap of $24.99 billion, a P/E ratio of 31.90 and a beta of 0.78.

VeriSign (NASDAQ:VRSN - Get Free Report) last released its earnings results on Thursday, July 24th. The information services provider reported $2.21 earnings per share for the quarter, beating analysts' consensus estimates of $2.20 by $0.01. VeriSign had a negative return on equity of 40.87% and a net margin of 50.05%. The company had revenue of $409.90 million during the quarter, compared to analyst estimates of $410.35 million. During the same quarter in the previous year, the company posted $2.01 EPS. VeriSign's revenue for the quarter was up 5.9% on a year-over-year basis.

VeriSign Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Wednesday, August 27th. Shareholders of record on Tuesday, August 19th will be issued a dividend of $0.77 per share. The ex-dividend date is Tuesday, August 19th. This represents a $3.08 dividend on an annualized basis and a dividend yield of 1.2%. VeriSign's dividend payout ratio is 36.75%.

VeriSign announced that its Board of Directors has approved a share repurchase program on Thursday, July 24th that authorizes the company to repurchase $1.11 billion in outstanding shares. This repurchase authorization authorizes the information services provider to purchase up to 4.1% of its shares through open market purchases. Shares repurchase programs are generally an indication that the company's leadership believes its stock is undervalued.

Insider Buying and Selling

In other news, EVP Thomas C. Indelicarto sold 501 shares of the business's stock in a transaction that occurred on Tuesday, July 8th. The stock was sold at an average price of $287.10, for a total value of $143,837.10. Following the sale, the executive vice president directly owned 37,769 shares of the company's stock, valued at $10,843,479.90. The trade was a 1.31% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through the SEC website. Also, CEO D James Bidzos sold 2,000 shares of the business's stock in a transaction that occurred on Wednesday, July 16th. The stock was sold at an average price of $281.35, for a total value of $562,700.00. Following the completion of the sale, the chief executive officer directly owned 515,772 shares in the company, valued at approximately $145,112,452.20. This represents a 0.39% decrease in their ownership of the stock. The disclosure for this sale can be found here. Over the last three months, insiders sold 39,604 shares of company stock worth $11,165,804. Insiders own 0.84% of the company's stock.

Hedge Funds Weigh In On VeriSign

Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. GAMMA Investing LLC lifted its position in VeriSign by 35.6% in the 1st quarter. GAMMA Investing LLC now owns 2,746 shares of the information services provider's stock valued at $697,000 after acquiring an additional 721 shares in the last quarter. Cache Advisors LLC bought a new position in VeriSign in the 4th quarter valued at approximately $685,000. Berkshire Hathaway Inc lifted its position in VeriSign by 3.6% in the 4th quarter. Berkshire Hathaway Inc now owns 13,271,457 shares of the information services provider's stock valued at $2,746,661,000 after acquiring an additional 455,844 shares in the last quarter. Wealth Enhancement Advisory Services LLC lifted its holdings in shares of VeriSign by 358.9% during the 1st quarter. Wealth Enhancement Advisory Services LLC now owns 70,017 shares of the information services provider's stock valued at $17,775,000 after buying an additional 54,759 shares during the period. Finally, OMNI 360 Wealth Inc. bought a new position in shares of VeriSign during the 1st quarter valued at $329,000. 92.90% of the stock is owned by institutional investors.

About VeriSign

VeriSign, Inc, together with its subsidiaries, provides domain name registry services and internet infrastructure that enables internet navigation for various recognized domain names worldwide. The company enables the security, stability, and resiliency of internet infrastructure and services, including providing root zone maintainer services, operating two of thirteen internet root servers; and offering registration services and authoritative resolution for the .com and .net domains, which supports global e-commerce.