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What: Shares of electronic-payment company VeriFone Systems
So what: Deutsche Bank downgraded VeriFone from hold to sell while lowering its price target from $44 to $40. Deutsche Bank analyst Bryan Keane questioned VeriFone's organic growth estimates, saying its figures are actually inflated through acquisitions that shouldn't be included in organic estimates.
Now what: VeriFone had stated 11.8% organic growth in the first quarter, but Keane believes it was flat in actuality, while the rise of mobile payment processing presents significant risk. In response, VeriFone has issued a statement to defend itself from Deutsche Bank's claims, reiterating that it calculates organic growth using the commonly accepted methodology of excluding revenue from acquisitions until 12 months later. VeriFone is reaffirming its fiscal-year 2012 and long-term organic growth rate expectations of 10% to 15%.
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