Internet Names Grow at VeriSign - Analyst Blog

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According to the latest Domain Name Industry Brief published by VeriSign Inc.  ( VRSN ), approximately six million names were added to the Internet in the fourth quarter of 2011 bringing the total number of registered domain names to nearly 225 million on a worldwide basis.

VeriSign Inc. provides essential Internet infrastructure services to companies, service providers and website owners. The company offers a broad platform of products and services that enables Internet users, website owners and operators of digital networks.

VeriSign's registry, security and communications services are essential for the smooth functioning of the online world. The company exclusively registers domain names within the .com, .net and .name generic top-level domains (gTLDs) under agreements with the Internet Corporation for Assigned Names and Numbers (ICANN) and the U.S. Department of Commerce (DOC).

The addition of 5.9 million domain names represents a growth of 2.7% over the fourth quarter of 2011 and marks the fourth straight with a growth of more than 2%.  Registrations have grown by more than 20.4 million, or 10 percent, since the fourth quarter of 2010.

Meanwhile, new .com and .net registrations totalled 7.9 million during the quarter, up 4.0% year over year. The .com/.net renewal rate for the fourth quarter was 73.5%, up from 73.3% for the third quarter.

The .com and .net TLDs experienced reached a combined total of 113.8 million names, up 2% sequentially and 8% year over year.

ICANN recently renewed Verisign's contract to serve as the authoritative registry operator for the .net registry for another six years, until 2017. Moreover, ICANN recently announced its plan to increase the number of generic top-level domains.

VeriSign views the introduction of new gTLDs as an adjacent growth opportunity. This should positively impact results in the coming years. 

VeriSign has considerably streamlined its business to focus on providing, reliable and secure Internet infrastructure services. The disposal of non-core businesses has boosted margins while the recently announced buyback of shares will positively boost the bottom-line.  

We continue to maintain a Neutral recommendation on VeriSign. In the short-run, we have a Zacks #1 Rank, which translates into a short-term rating of Strong Buy.


 
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