Verisign (VRSN) AI Stock Analysis

• Market Cap: $23.36B
• Dividend Yield: 0.92%
• Average Volume (3M): 1.11M
• Price to Earnings (P/E): 29.4
• Beta (1Y): 0.48
• Revenue Growth: 5.47%
• EPS Growth: -0.03%
• Country: US
• Employees: 929
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 2.27
• Shares Outstanding: 92,700,000
• 10 Day Avg. Volume: 1,092,513
• 30 Day Avg. Volume: 1,114,426
• PEG Ratio: 20.44
• Price to Book (P/B): -10.37
• Price to Sales (P/S): 13.04
• P/FCF Ratio: 23.22
• Enterprise Value/Market Cap: 1.17
• Enterprise Value/Revenue: 16.81
• Enterprise Value/Gross Profit: 19.11
• Enterprise Value/Ebitda: 23.66
• 1Y Price Target: $310.67
• Price Target Upside: 23.76% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 8.86
• Revenue Forecast (FY): $1.66B

• Rating: 62 Neutral
• Price Target: $262.00 ▲(4.37% Upside)

Verisign's overall stock score is driven by strong earnings call results and solid financial performance, particularly in profitability and cash flow. However, technical analysis indicates bearish momentum, and valuation metrics suggest the stock may be overvalued. The balance sheet's weaknesses and high leverage are significant risks, impacting the overall score.

Positive Factors

Revenue Growth

Verisign's consistent revenue growth reflects its strong market position in domain registration, ensuring stable cash flow and financial health.

Domain Name Base Expansion

The expansion of the domain name base indicates sustained demand for Verisign's core services, supporting long-term revenue stability.

Cash Flow Generation

Strong cash flow generation enhances Verisign's ability to invest in growth opportunities and return capital to shareholders, bolstering financial resilience.

Negative Factors

High Leverage

High leverage and negative equity pose financial risks, potentially limiting Verisign's ability to invest in growth or weather economic downturns.

Increased Operating Expenses

Rising operating expenses can pressure margins and reduce profitability, impacting Verisign's ability to maintain its competitive edge.

Slower Growth in Asia Pacific

Slower growth in the Asia Pacific region may hinder Verisign's global expansion efforts, affecting long-term revenue diversification.

Verisign Business Overview & Revenue Model

Company Description

VeriSign, Inc., together with its subsidiaries, provides domain name registry services and internet infrastructure that enables internet navigation for various recognized domain names worldwide. It enables the security, stability, and resiliency of internet infrastructure and services, including providing root zone maintainer services, operating two of the 13 internet root servers; and offering registration services and authoritative resolution for the .com and .net domains, which support global e-commerce. The company also back-end systems for .cc, .gov, .edu, and .name domain names, as well as operates distributed servers, networking, security, and data integrity services. VeriSign, Inc. was incorporated in 1995 and is headquartered in Reston, Virginia.

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 strong profitability and cash flow generation, which are key strengths. However, the negative equity and high leverage pose significant financial risks. The company maintains stable revenue growth, but the balance sheet's weaknesses could impact long-term sustainability.

Income Statement

Verisign demonstrates strong profitability with a high gross profit margin of 87.97% and a solid net profit margin of 49.86% for TTM. Revenue growth is modest at 1.78%, indicating stable but slow expansion. EBIT and EBITDA margins are robust, reflecting efficient operations.

Balance Sheet

The balance sheet reveals a negative stockholders' equity, leading to a concerning debt-to-equity ratio of -1.25. This indicates high leverage and potential financial risk. The negative return on equity suggests inefficiencies in generating returns from shareholders' investments.

Cash Flow

Cash flow analysis shows a healthy free cash flow growth of 5.81% and a strong free cash flow to net income ratio of 97.31%, indicating effective cash generation relative to earnings. The operating cash flow to net income ratio is solid, supporting operational stability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.63B	1.56B	1.49B	1.42B	1.33B	1.27B
Gross Profit	1.43B	1.37B	1.30B	1.22B	1.14B	1.08B
EBITDA	1.16B	1.13B	1.10B	1.00B	913.41M	886.74M
Net Income	811.00M	785.70M	817.60M	673.80M	784.80M	814.89M
Balance Sheet
Total Assets	1.40B	1.41B	1.75B	1.73B	1.98B	1.77B
Cash, Cash Equivalents and Short-Term Investments	617.70M	599.90M	926.40M	980.40M	1.21B	1.17B
Total Debt	1.79B	1.80B	1.80B	1.79B	1.79B	1.80B
Total Liabilities	3.45B	3.36B	3.33B	3.30B	3.24B	3.16B
Stockholders Equity	-2.05B	-1.96B	-1.58B	-1.56B	-1.26B	-1.39B
Cash Flow
Free Cash Flow	1.01B	874.50M	808.00M	803.70M	754.12M	686.79M
Operating Cash Flow	1.03B	902.60M	853.80M	831.10M	807.15M	730.18M
Investing Cash Flow	-20.10M	286.30M	-97.40M	355.70M	-269.25M	-72.26M
Financing Cash Flow	-1.05B	-1.22B	-889.80M	-1.04B	-719.13M	-764.88M

Verisign Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 251.02
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• 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 Neutral. The current price of 251.02 is above the 20-day moving average (MA) of 247.98, below the 50-day MA of 257.50, and below the 200-day MA of 263.66, indicating a neutral trend. The MACD of -0.59 indicates Negative momentum. The RSI at 49.74 is Neutral, neither overbought nor oversold. The STOCH value of 59.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for VRSN.

Verisign Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CHKP	76 Outperform	$20.24B	20.47	34.19%	―	6.31%	25.27%
FTNT	71 Outperform	$60.33B	33.40	228.04%	―	14.78%	22.52%
ZS	67 Neutral	$40.11B	―	-2.41%	―	23.24%	-8.83%
VRSN	62 Neutral	$23.36B	29.36	―	0.92%	5.47%	-0.03%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
GDDY	60 Neutral	$17.29B	22.05	369.45%	―	8.79%	-55.15%
SAIL	39 Underperform	$10.24B	―	―	―	25.99%	-25.47%

Verisign Corporate Events

Verisign’s Earnings Call Highlights Robust Growth and AI Optimism

Verisign’s recent earnings call painted a picture of robust financial health and strategic optimism. The company reported significant increases in revenue, earnings per share (EPS), and its domain name base, alongside improved renewal rates and substantial returns to shareholders. Despite facing challenges such as increased operating expenses and slower growth in the Asia Pacific region, Verisign remains optimistic, particularly about the potential of artificial intelligence (AI) to drive future growth. Overall, the positive aspects of the earnings call significantly outweighed the negatives, suggesting a favorable outlook for the company.

Verisign Reports Strong Q3 2025 Financial Results

Verisign, Inc., a global leader in internet infrastructure and domain name registry services, plays a crucial role in enabling internet navigation and maintaining the security and stability of the Domain Name System. In its third-quarter 2025 earnings report, Verisign announced a revenue increase of 7.3% year-over-year, reaching $419 million. The company also reported a net income of $213 million, with diluted earnings per share rising to $2.27 from $2.07 in the same quarter of the previous year.