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Gen Digital (GEN)
NASDAQ:GEN
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Gen Digital
(NASDAQ:GEN)
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Rating:64Neutral
Price Target:
$31.00
▲(10.40% Upside)
Gen Digital's overall stock score is driven by strong financial performance and positive earnings call sentiment, indicating robust growth and strategic advancements. However, technical analysis suggests bearish momentum, and valuation metrics indicate potential overvaluation, which tempers the overall score.
Positive Factors
Revenue Growth
Strong revenue growth indicates robust demand for Gen Digital's products, enhancing its market position and supporting long-term expansion.
Product Innovation
Continued product innovation strengthens Gen Digital's competitive edge, ensuring relevance in the rapidly evolving cybersecurity landscape.
Customer Loyalty
High customer satisfaction and loyalty, as indicated by a strong Net Promoter Score, suggest sustained revenue through customer retention.
Negative Factors
High Leverage
High leverage can limit financial flexibility and increase risk, necessitating careful debt management to ensure long-term stability.
Net Profit Margin Decline
Declining net profit margins could pressure profitability, requiring efficiency improvements to sustain long-term financial health.
Operational Risks
Operational risks and uncertainties can impact business performance, necessitating strategic planning to mitigate potential adverse effects.
Gen Digital (GEN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$17.32B
Dividend Yield1.78%
Average Volume (3M)3.69M
Price to Earnings (P/E)29.6
Beta (1Y)0.95
Revenue Growth10.34%
EPS Growth0.68%
CountryUS
Employees3,400
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)0.64
Shares Outstanding615,869,140
10 Day Avg. Volume3,885,008
30 Day Avg. Volume3,692,792
Financial Highlights & Ratios
PEG Ratio2.68
Price to Book (P/B)7.19
Price to Sales (P/S)4.14
P/FCF Ratio13.52
Enterprise Value/Market Cap1.56
Enterprise Value/Revenue6.40
Enterprise Value/Gross Profit8.02
Enterprise Value/Ebitda13.07
Forecast
1Y Price Target
$35.38Price Target Upside26.00% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
Gen Digital Business Overview & Revenue Model
Company DescriptionGen Digital Inc. provides cyber safety solutions for consumers in the United States, Canada, Latin America, Europe, the Middle East, Africa, the Asia Pacific, and Japan. It offers Norton 360, an integrated platform provides extensive cyber safety coverage and a subscription service providing protection for PCs, Macs, and mobile devices against malware, viruses, adware, ransomware, and other online threats on various platforms; and Norton and LifeLock identity theft protection solution that offers monitoring, alerts, and restoration services to its customers. The company also provides Norton Secure VPN solution, which enhances security and online privacy by providing an encrypted data tunnel; Privacy Monitor Assistant, an on-demand, white glove service where agents help members delete personal information from data brokers online; Home Title Protect product that detects fraud and notifies members; and Avira Security, a consumer-focused portfolio of cybersecurity and privacy solutions. It offers Dark Web Monitoring product, which looks for personal information of its Norton 360 members on the Dark Web; and Social Media Monitoring solution that helps to keep customers' social media accounts safer by monitoring them for account takeovers, risky activity, and inappropriate content. The company also provides AntiTrack product, which helps to keep personal information and browsing activity private by blocking trackers and disguising digital fingerprints online; and Online Reputation Management solution that manages online search results, personal branding, and digital privacy. It markets and sells its products and related services through retailers, telecom service providers, hardware original equipment manufacturers, and employee benefit providers, as well as e-commerce platform. The company was formerly known as NortonLifeLock Inc. and changed its name to Gen Digital Inc. in November 2022. Gen Digital Inc. was founded in 1982 and is based in Tempe, Arizona.
How the Company Makes MoneyGen Digital generates revenue primarily through the sale of subscription-based cybersecurity products and services. Its key revenue streams include individual and enterprise subscriptions for antivirus software, identity theft protection, and secure VPN services. The company also earns income from partnerships with other technology firms, which may involve bundled offerings or co-marketing initiatives. Additionally, Gen Digital may leverage data analytics to enhance its product offerings and improve customer retention, further contributing to its overall earnings.
Gen Digital Key Performance Indicators (KPIs)
Gen Digital Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q1-2026)
| % Change Since: |
Next Earnings Date:Oct 30, 2025
Earnings Call Sentiment Positive
The earnings call presents a strong start to fiscal year 2026, highlighted by impressive revenue growth, successful MoneyLion integration, and innovative product developments. Despite some operational risks and increased leverage due to acquisitions, the overall performance and outlook remain positive.Q1-2026 Updates
Positive Updates
Strong Revenue and Growth
Q1 bookings and revenue grew over 30% year-over-year on a reported basis, with a 10% growth on a pro forma basis. Non-GAAP EPS exceeded guidance, coming in at $0.64, up 20% year-over-year.
MoneyLion Integration Success
The acquisition of MoneyLion contributed 16 points of overall growth, and its revenue grew 45% year-over-year. Integration is ahead of schedule, with the first integrated product launch expected by fall.
Cyber Safety Platform Expansion
Cyber Safety Platform represented 2/3 of Q1 revenue with 11% growth on a reported basis. AI-driven innovations like Norton Deepfake Detection enhance customer protection.
Trust-Based Solutions Growth
Trust-Based Solutions grew over 100% on a reported basis. LifeLock continues to deliver strong growth, and MoneyLion's marketplace saw its third consecutive quarter of growth above 50%.
Record Net Promoter Score
LifeLock achieved a record Net Promoter Score of 71, reflecting stronger customer trust and loyalty.
Improved Financial Guidance
Annual revenue guidance raised by $100 million to a range of $4.8 billion to $4.9 billion, with a commitment to 12% to 15% annual EPS growth.
Negative Updates
Operational Risks and Uncertainties
The call mentioned risks and uncertainties that may cause actual results to differ materially from expectations, though specific challenges were not highlighted.
Dependency on AI and Cybersecurity Landscape
Increasing sophistication in AI-assisted cyber threats necessitates continuous innovation and adaptation, posing ongoing challenges.
Leverage and Debt Management
Net leverage was at 3.4x EBITDA, slightly up due to the $900 million cash payment for MoneyLion, with a commitment to bring it down to less than 3x by the end of fiscal 2027.
Company Guidance
During Gen's First Quarter Fiscal Year 2026 earnings call, notable guidance metrics highlighted a strong start with a 30% year-over-year increase in revenue on a reported basis and 10% on a pro forma basis. Non-GAAP operating margins were robust at 52%, and non-GAAP EPS exceeded expectations at $0.64, marking a 20% year-over-year rise. The quarter included an extra fiscal week contributing approximately 9 points to revenue growth. Excluding MoneyLion's contribution and the extra week, Gen's revenue rose 5% year-over-year, maintaining a strong customer base of over 76 million paid customers. The Cyber Safety Platform, representing two-thirds of Q1 revenue, grew 11% reported and 4% normalized. Meanwhile, the Trust-Based Solutions segment saw over 100% reported growth and 25% normalized. The company has raised its annual revenue guidance by $100 million to a range of $4.8 billion to $4.9 billion, projecting continued growth driven by strong demand and strategic investments in AI and product innovation.Gen Digital Financial Statement Overview
Summary
Gen Digital demonstrates robust revenue growth and profitability, with strong cash flow generation. However, high leverage and declining net profit margins are areas of concern. The company should focus on improving net profitability and managing its debt levels to ensure long-term financial stability.Income Statement
Gen Digital shows strong revenue growth with a 7.42% increase in TTM, supported by healthy gross and EBIT margins of 79.82% and 38.66% respectively. However, the net profit margin has decreased to 14.12% from previous periods, indicating some pressure on net profitability.75
Positive
Balance Sheet
The company has a high debt-to-equity ratio of 3.75, suggesting significant leverage, which could pose risks if not managed properly. Return on equity is solid at 26.88%, reflecting efficient use of equity, but the equity ratio is relatively low at 14.45%, indicating a reliance on debt financing.65
Positive
Cash Flow
Operating cash flow and free cash flow have shown growth, with a free cash flow growth rate of 11.86% in TTM. The free cash flow to net income ratio is strong at 98.76%, indicating good cash generation relative to net income. However, the operating cash flow to net income ratio is moderate at 47.80%, suggesting room for improvement in cash flow efficiency.70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2019 | Dec 2018 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.23B | 3.94B | 3.80B | 3.32B | 4.73B | 4.85B |
| Gross Profit | 3.37B | 3.16B | 3.07B | 2.73B | 3.68B | 3.81B |
| EBITDA | 2.07B | 2.03B | 1.60B | 1.56B | 350.00M | 1.33B |
| Net Income | 597.00M | 643.00M | 607.00M | 1.35B | 31.00M | 1.16B |
Balance Sheet | ||||||
| Total Assets | 16.36B | 15.49B | 15.79B | 15.95B | 15.94B | 15.76B |
| Cash, Cash Equivalents and Short-Term Investments | 828.00M | 1.01B | 846.00M | 750.00M | 2.04B | 2.16B |
| Total Debt | 8.86B | 8.31B | 8.65B | 9.82B | 4.45B | 5.03B |
| Total Liabilities | 13.99B | 13.23B | 13.65B | 13.75B | 10.20B | 10.71B |
| Stockholders Equity | 2.37B | 2.27B | 2.14B | 2.20B | 5.74B | 5.06B |
Cash Flow | ||||||
| Free Cash Flow | 1.35B | 1.21B | 2.04B | 751.00M | 1.29B | 808.00M |
| Operating Cash Flow | 1.37B | 1.22B | 2.06B | 757.00M | 1.50B | 950.00M |
| Investing Cash Flow | -971.00M | -100.00M | 2.00M | -6.55B | -241.00M | -21.00M |
| Financing Cash Flow | -214.00M | -970.00M | -1.96B | 4.68B | -1.21B | -3.48B |
Gen Digital Technical Analysis
Negative
28.08
Price Trends
29.76
Negative
29.46
Negative
28.05
Positive
Market Momentum
-0.44
Positive
34.51
Neutral
27.49
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GEN, the sentiment is Negative. The current price of 28.08 is below the 20-day moving average (MA) of 28.92, below the 50-day MA of 29.76, and above the 200-day MA of 28.05, indicating a neutral trend. The MACD of -0.44 indicates Positive momentum. The RSI at 34.51 is Neutral, neither overbought nor oversold. The STOCH value of 27.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GEN.
Gen Digital Risk Analysis
Gen Digital disclosed 39 risk factors in its most recent earnings report. Gen Digital reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Gen Digital Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $65.27B | 34.44 | 94.14% | ― | 14.46% | 48.06% | |
70 Neutral | $75.64B | -663.40 | -9.44% | ― | 27.32% | -11.94% | |
67 Neutral | $24.74B | -146.61 | -3.94% | ― | 39.45% | -982.51% | |
67 Neutral | $48.21B | -1,146.83 | -2.31% | ― | 23.31% | 31.04% | |
66 Neutral | $124.67B | -415.18 | -7.91% | ― | 23.46% | -270.07% | |
64 Neutral | $17.32B | 29.63 | 27.54% | 1.78% | 10.34% | 0.68% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
GEN
Gen Digital
28.08
1.57
5.92%
FTNT
Fortinet
86.29
9.31
12.09%
CYBR
CyberArk Software
495.01
215.96
77.39%
ZS
Zscaler
307.58
137.95
81.32%
CRWD
CrowdStrike Holdings
496.80
213.05
75.08%
NET
Cloudflare
224.56
145.13
182.71%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.