Analyzing Zix Corporation (ZIXI) and VeriSign (NASDAQ:VRSN)

VeriSign (NASDAQ: VRSN) and Zix Corporation (NASDAQ:ZIXI) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, earnings, analyst recommendations, valuation, profitability and risk.

Institutional and Insider Ownership



67.9% of Zix Corporation shares are held by institutional investors. 0.9% of VeriSign shares are held by insiders. Comparatively, 4.5% of Zix Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent ratings and target prices for VeriSign and Zix Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
VeriSign 0 3 0 0 2.00
Zix Corporation 0 1 1 0 2.50

VeriSign currently has a consensus price target of $103.33, indicating a potential downside of 5.26%. Zix Corporation has a consensus price target of $6.75, indicating a potential upside of 45.16%. Given Zix Corporation’s stronger consensus rating and higher possible upside, analysts clearly believe Zix Corporation is more favorable than VeriSign.

Earnings and Valuation

This table compares VeriSign and Zix Corporation’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
VeriSign $1.15 billion 9.48 $747.69 million $3.70 29.48
Zix Corporation $63.16 million 3.98 $13.98 million $0.12 38.75

VeriSign has higher revenue and earnings than Zix Corporation. VeriSign is trading at a lower price-to-earnings ratio than Zix Corporation, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

VeriSign has a beta of 1.19, indicating that its share price is 19% more volatile than the S&P 500. Comparatively, Zix Corporation has a beta of 1.31, indicating that its share price is 31% more volatile than the S&P 500.

Profitability

This table compares VeriSign and Zix Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
VeriSign 39.79% -37.13% 19.07%
Zix Corporation 10.49% 16.07% 9.72%

Summary

Zix Corporation beats VeriSign on 8 of the 14 factors compared between the two stocks.

About VeriSign

VeriSign, Inc. is a provider of domain name registry services and Internet security. The Company operates through Registry Services and Security Services segment. Registry Services ensure the security, stability and resiliency of Internet infrastructure and services, including the .com and .net domains, and operation of the root-zone maintainer functions for the core of the Internet’s Domain Name System (DNS). Security Services provides infrastructure assurance services consisting of Distributed Denial of Services (DDoS) Protection Services and Managed DNS Services. DDoS Protection Services supports online business continuity by providing monitoring and mitigation services against DDoS attacks. Managed DNS Services is a hosting service that delivers DNS resolution for the availability of Web-based systems.

About Zix Corporation

Zix Corporation offers e-mail encryption, data loss prevention and bring-your-own-device (BYOD) security to meet business data protection and compliance needs. The Company operates through e-mail encryption and security solutions. Its Zix Email Encryption enables the secure exchange of e-mails that include sensitive information through a secure messaging service. It offers ZixDirectory, an e-mail encryption community that is designed to share identities of its members; Best Method of Delivery, which is designed to deliver e-mail, and ZixGateway, which automatically encrypts and decrypts messages with sensitive content. ZixCorp delivers over 1.5 million encrypted messages on a typical business day. On an average, 70% of those encrypted messages are exchanged between senders and recipients. It also offers ZixQuarantine, an e-mail-specific solution. Its ZixOne is a mobile e-mail application that solves the information technology (IT) challenge created by the BYOD trend in the workplace.

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