Analysts Call Verint Systems FY15 Guidance 'Conservative'

Verint Systems Inc. (NASDAQ: VRNT) disappointed investors with a lower-than-expected outlook recently but a couple of analysts said its forecast is probably conservative.

Verint, up more than 37 percent year-to-date, traded recently at $59.75, down 2 percent.

Management of the company is "continuing its 'under promise and over deliver' strategy," FBR Capital Markets' Daniel H. Ives said in a note Thursday.

Verint is likely to steadily increase its annual revenue outlook through fiscal 2016, according to Credit Suisse's Michael Nemeroff.

While its initial 2016 forecast missed expectations by a small margin, "this reflects management's conservatism," Nemeroff said.

Nemeroff raised his target on Verint more than 8 percent to $67 and maintained an Outperform rating; Ives also maintained an Outperform rating and boosted his target more than 4 percent, also to $67.

The company, which makes a wide range of security and surveillance products for business and governments, is poised to expand the marketing of its computer security products to businesses from its current efforts aimed solely at governments.

"It's a golden opportunity to expand its total available market," Ives said.

Despite the miss, Oppenheimer's Shaul Eyar called the company's fiscal 2015 forecast "solid" and said any share price weakness resulting from the outlook is a buying opportunity.

Eyar maintained a Buy rating and $70 target, but trimmed his 2015 estimate very slightly and now expects earnings of $3.76 a share, on revenue of $1.25 billion.

Analysts on average expect fiscal 2015 earnings of $3.42 a share, on revenue of $1.16 billion.