Verisign (VRSN) AI Stock Analysis

• Market Cap: $25.15B
• Dividend Yield: 0.57%
• Average Volume (3M): 1.01M
• Price to Earnings (P/E): 32.1
• Beta (1Y): 0.57
• Revenue Growth: 4.59%
• EPS Growth: 0.26%
• Country: US
• Employees: 929
• Sector: Technology
• Sector Strength: 85
• Industry: Software - Infrastructure
• EPS (TTM): 2.21
• Shares Outstanding: 93,408,590
• 10 Day Avg. Volume: 907,966
• 30 Day Avg. Volume: 1,011,189
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.13
• Enterprise Value/Revenue: 17.74
• Enterprise Value/Gross Profit: 20.18
• Enterprise Value/Ebitda: 24.72
• 1Y Price Target: $338.50
• Price Target Upside: 24.34% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 66 Neutral
• Price Target: $291.00 ▲(6.89% Upside)

Verisign's overall stock score is driven by its strong financial performance and positive earnings call sentiment. The company's robust profitability and cash flow generation are significant strengths, although high leverage and negative equity pose risks. Technical indicators suggest neutral momentum, while valuation metrics indicate potential overvaluation. The positive earnings call highlights growth in domain registrations and shareholder returns, offsetting some concerns about market volatility.

Positive Factors

Domain Growth

Verisign's domains have seen a seventh consecutive month-over-month increase, signaling robust underlying fundamentals.

Earnings Guidance

The domain name base is already approaching the high end of FY25 guidance, and some level of guidance raise is likely at earnings.

Negative Factors

Domain Challenges

.net domains remain softer, which poses a challenge to Verisign's domain name base growth.

Domain Decline

.net domain names have declined month-over-month for six straight months.

Verisign Business Overview & Revenue Model

Company Description

Verisign, Inc. (VRSN) is a global leader in domain name registry services and internet infrastructure. The company operates a diverse range of services across the internet ecosystem, primarily focusing on the management of the authoritative registry for .com, .net, and other top-level domains (TLDs). Verisign provides various security services and solutions, including DNS services, DDoS protection, and other cybersecurity offerings, which are essential for the reliable operation of online businesses and services.

How the Company Makes Money

Verisign generates revenue primarily through domain name registration and renewal fees, focusing on the .com and .net TLDs, which constitute its core revenue stream. The company earns recurring revenue as domain names are registered and renewed, with most registrations occurring on an annual basis. Additionally, Verisign offers various internet security services, including Managed DNS and DDoS mitigation services, which contribute to its revenue. The company benefits from exclusive contracts with the Internet Corporation for Assigned Names and Numbers (ICANN) to manage these TLDs, ensuring a steady demand for its services. Partnerships with registrars and resellers further enhance its distribution and market reach, allowing Verisign to capture a significant share of the domain registration market.

Verisign Financial Statement Overview

Summary

Verisign exhibits robust profitability with high margins and strong cash flow generation, but the balance sheet is highly leveraged with negative equity, which poses financial risks. Strong cash flow supports operations and debt obligations despite these risks.

Income Statement

Verisign demonstrates strong profitability with a robust gross profit margin of 87.9% and a net profit margin of 50.0% in the TTM. The company shows healthy revenue growth, with a 2.6% increase from the previous year, and maintains solid EBIT and EBITDA margins of 67.9% and 70.9%, respectively. These metrics indicate a well-managed cost structure and efficient operations, although the net income has slightly fluctuated over recent years.

Balance Sheet

Verisign's balance sheet reflects high leverage with a negative stockholders' equity, leading to a challenging debt-to-equity ratio scenario. The equity ratio is negative due to the company's significant liabilities surpassing its assets, posing potential financial risk. However, the company has managed to maintain stable total assets and cash reserves over the years, indicating some balance sheet resilience despite the high debt levels.

Cash Flow

The company exhibits strong cash flow generation, with a 8.6% growth in free cash flow in the TTM. The operating cash flow to net income ratio is favorable at 1.22, indicating efficient conversion of profits into cash. Additionally, the free cash flow to net income ratio of 1.19 demonstrates robust cash flow management. These metrics highlight Verisign's ability to generate substantial cash flows to support its operations and debt obligations.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.56B	1.49B	1.42B	1.33B	1.27B
Gross Profit	1.37B	1.30B	1.22B	1.14B	1.08B
EBITDA	1.13B	1.10B	1.00B	913.41M	886.74M
Net Income	785.70M	817.60M	673.80M	784.80M	814.89M
Balance Sheet
Total Assets	1.41B	1.75B	1.73B	1.98B	1.77B
Cash, Cash Equivalents and Short-Term Investments	599.90M	926.40M	980.40M	1.21B	1.17B
Total Debt	1.80B	1.80B	1.79B	1.79B	1.79B
Total Liabilities	3.36B	3.33B	3.30B	3.24B	3.16B
Stockholders Equity	-1.09B	-1.58B	-1.56B	-1.26B	-1.39B
Cash Flow
Free Cash Flow	874.50M	808.00M	803.70M	754.12M	686.79M
Operating Cash Flow	902.60M	853.80M	831.10M	807.15M	730.18M
Investing Cash Flow	286.30M	-97.40M	355.70M	-269.25M	-72.26M
Financing Cash Flow	-1.22B	-889.80M	-1.04B	-719.13M	-764.88M

Verisign Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 272.24
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VRSN, the sentiment is Positive. The current price of 272.24 is below the 20-day moving average (MA) of 272.39, below the 50-day MA of 279.00, and above the 200-day MA of 241.60, indicating a neutral trend. The MACD of -3.03 indicates Negative momentum. The RSI at 48.75 is Neutral, neither overbought nor oversold. The STOCH value of 70.52 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VRSN.

Verisign Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CHKP	76 Outperform	$20.37B	24.67	30.30%	―	6.27%	7.14%
GEN	73 Outperform	$19.40B	32.88	27.54%	1.59%	10.34%	0.68%
ZS	73 Outperform	$42.80B	―	-2.68%	―	25.46%	49.20%
AKAM	72 Outperform	$10.97B	26.97	9.21%	―	3.98%	-31.18%
CYBR	70 Neutral	$21.75B	1,777.39	-10.35%	―	39.45%	-982.51%
VRSN	66 Neutral	$25.15B	32.13	-72.04%	0.57%	4.59%	0.26%
Sector *	57 Neutral	HK$14.80B	10.64	-0.76%	4.27%	6.99%	-31.80%

Verisign Corporate Events

Verisign Enters Stock Sale Agreement with Berkshire Hathaway

On July 28, 2025, VeriSign, Inc. entered into an underwriting agreement with Berkshire Hathaway Consolidated Pension Plan Master Trust and Burlington Northern Santa Fe, LLC Master Retirement Trust for the sale of 4,300,000 shares of common stock at $285.00 per share. The offering aims to reduce Berkshire Hathaway Inc.’s ownership below the ten percent regulatory threshold, with the closing expected on July 30, 2025. VeriSign will not receive any proceeds from this transaction, and Berkshire Hathaway has agreed to a 365-day lock-up on remaining shares.

Verisign Expands Share Repurchase Program by $913.1 Million

On July 24, 2025, Verisign‘s Board of Directors approved an additional $913.1 million for the company’s share repurchase program, bringing the total authorization to $1.5 billion. The company reported a 5.9% increase in revenue for the second quarter of 2025 compared to the same period in 2024, with net income rising to $207 million. Verisign also declared a quarterly dividend and highlighted its 28-year record of 100% availability for its .com and .net domain name resolution system. The company ended the quarter with 170.5 million domain name registrations and processed 10.4 million new registrations, reflecting its strong market position.

Verisign Stockholders Approve Key Amendments at Annual Meeting

At the annual meeting on May 22, 2025, Verisign stockholders approved an amendment to the company’s Restated Certificate of Incorporation, limiting the liability of certain officers under Delaware law. Additionally, stockholders elected directors, approved executive compensation, ratified KPMG LLP as the independent auditor, and voted against a proposal for stockholder action by written consent.