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Thursday, May 22, 2008

VeriFone (NYSE:PAY): First Data could buy PAY - SunTrust

SunTrust analyst Andrew Jeffrey is out with a major call on VeriFone (NYSE:PAY) saying the protracted internal accounting challenges, and the shares resulting swoon, leave the company susceptible to a hostile takeover bid. Firm sees First Data Corp. as the most likely suitor and the most logical strategic partner for VeriFone. Further, a recent conversation with a leading value-added reseller leaves them confident that VeriFone's market share has not suffered from its internal accounting challenges. Firm believes a business combination would significantly extend FDC's distribution reach and technology capabilities while sharply lowering its manufacturing costs. Reits Buy and $22 tgt on PAY.

Notablecalls: Looking for a $0.50-1.00 move in PAY - fyi. (As distributed on NCN)

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