VeriFone Systems Inc (PAY) posted a net income of $14.5 million in the second quarter of fiscal 2012 or $0.13 per diluted share compared with a net loss of $3.1 million or ($0.03) per share in the previous quarter and a net income of $25.2 million or $0.27 per share in the year-ago quarter. Excluding one-time charges but including stock-based compensation expense, net income came in at $0.54 per share, beating the Zacks Consensus Estimate by a penny.
VeriFone reported revenues of $472 million in the second quarter of fiscal 2012, up 61.4% year over year and up 12.5% sequentially.
Based in San Jose, California, VeriFone designs, markets and services a transaction automation system that facilitates electronic payments between consumers, merchants and financial institutions.

VeriFone expects to see strong demand in the third quarter as well. However, concern looms large over the potential impact of a declining euro and other currencies when converted into U.S. dollar. For the third fiscal quarter, VeriFone expects to report net revenues between $495 million and $500 million. Excluding stock-based compensation, net income per diluted share is projected between $0.68 and $0.70. For fiscal 2012 (including 10 months of Point revenues), VeriFone expects to report net revenues between $1.900 billion and $1.925 billion. Excluding stock-based compensation, net income per diluted share is projected between $2.60 and $2.66.

Contributer Thomas Doherty is a student at Villanova University majoring in Finance and Economics. All questions and comments can be sent to Thomas@KeeneOnTheMarket.com

For more information, Follow Andrew on twitter at https://twitter.com/#!/KeeneOnMarket or like us on facebook: https://www.facebook.com/KeeneOnTheMkt

Other factors is that FB trades 193 million shares in a day and the only stock that trades close to that is BAC which trades 250 million and BAC traded about 100,000 options yesterday. Another question about volatility, where will it be? All the social media stocks are ranged between 65-85, with LNKD being a very similar to FB and that has a volatility of 77.

Who will be the main market maker, the easy answer is Citadel.

What else is important to know, earnings is schedules for July 25th, after July expiration so volatility in August will always stay very high. The last couple of days FB has had a tight range in the stock and since implied volatility is based on historical volatility, the more it trades in a smaller intraday range, the lower the implied volatility should trade. Also, since there are so many funds and banks that own this stock, they will want to protect their position, and they will be doing this by buying out of the money Puts and Selling out of the money Calls, making the Skew even more expensive.

One last thing to ponder, there will be Dollar Strikes and right off the bat there will not be weekly options. Also, if there are more Puts being Bought and Calls being sold, then traders will Sell MORE stock to hedge their position forcing the stock to go lower and the hard-to-borrow to increase

Although the Hang Seng managed to climb to green today it stayed at a loss of 1.3% for the week
marking a third straight weekly loss for the index.

The FTSEurofirst 300 is currently down .4% due to words from the Belgian deputy prime minister,
proving anyone of note can say anything ambiguous about Greece and it will negatively affect the
market.

Commodities futures are looking good this morning with crude, gold and silver all up and natural gas in
the red.

Some stocks to watch this morning are BAC and LEH after BAC and Barclays agreed to sell the remaining
shares of Archstone to LEH and equity residential.

Contributer Chris Rygh is currently pursuing his MBA in Wisconsin and has a passion for the Market.
Comments can be directed to ryghcw19@uww.edu

Unprofitable:  I lose money on this trade if PAY closes above $48.30 June 15, 2012.  The most I can lose on this trade is the amount I paid can be worth $1 minus the price I sold it for, $.30 for a total of $.70.  

Reason I Like This Trade:  PAY has sold off 3 times on earnings and the stock looks very weak and has all its moving averages higher.  I think if it does rally then it will get selling pressure.

UPDATE 5.29.2012  This Spread is currently worth $.05, but no trade is a winner until it is closed.  I will leave this trade on as there is little hope for PAY to rally to $48 in 13 trading days.

UPDATE 5.31.2012  Another winner, but leaving it on until it goes to zero. 

While analysts expected earnings to total 69 cents a share, Tiffany’s reported a company profit of onl $81.5 million, or 64 cents a share. Additionally, compared to last years earnings of $81.1, or 63 cents per share, Tiffany’s slow growth highlights the lack of spending on price sensitive goods. Moreover, Tiffany’s reported that their revenue increased by 8% to $817 million. However, sales fell below analysts estimates at $819.2 million. Finally, Tiffany’s lowered their 2012 EPS to $3.70 to $3.80, well below analyst expectations of $3.97. Previously, the company forecast earnings per share of $3.95 to $4.05.

However, Pandora is up $1.48, almost 15%, due to larger than expected sales growth. Finally, Oil has increased slighty above the $90 mark and gold is up $20, a change of 1.3%. Looking forward to tomorrow, the consumer sentiment index is released tomorrow morning at 8:55 CST. For more updates, follow Andrew on twitter at @keeneonmarket or like us on facebook at https://www.facebook.com/KeeneOnTheMkt

The Hang Seng closed down over .6% and the Shanghai composite lost a quarter of a percent, driven down by poor results from a private survey on the Chinese industry.

The FTSEurofirst 300 is rebounding, up over 1%, with investors picking up bargain stocks after yesterday’s drop of 2.2%.

The Euro hit a 2 year low today after Germany released economic data suggesting no European country is safe from crisis.

The day has a positive outlook for commodities with crude and gold both up, while silver and natural gas are down slightly.

Contributer Chris Rygh is currently pursuing his MBA in Wisconsin and has a passion for the Market. Comments can be directed to ryghcw19@uww.edu