Key Takeaways:
- AI-Driven Growth: Gen Digital is leveraging AI to combat emerging threats, with scam blocks up 60% year-over-year.
- Price Projection: Based on current execution, GEN stock could reach $29 by March 2028.
- Potential Gains: This target implies a total return of 18% from the current price of $24.60.
- Annual Return: Investors could see roughly 8% growth over the next 2.1 years.
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Valued at a market cap of $15.2 billion, Gen Digital (GEN) stock has returned “just” 33% over the past decade, underperforming the broader markets by a significant margin.
Gen Digital delivered another impressive quarter with double-digit bookings growth and a 14% jump in earnings per share.
The cybersecurity company now serves over 78 million paid customers and continues building what CEO Vincent Pilette calls “a trusted AI-powered platform that keeps people safe online.”
- The company’s Q3 performance shows the strategy is working. Cyber safety bookings grew 5% as customers increasingly choose comprehensive Norton 360 with LifeLock offerings.
- Meanwhile, the Trust-Based Solutions segment, which includes MoneyLion, surged nearly 40% as Gen Digital expands beyond traditional security into financial wellness.
- Mobile threats are evolving rapidly. Gen Digital blocked over 45 million fake online shop attacks last quarter, up more than 60% from the prior year. These scams now account for 40% of all consumer cyber threats, using AI to create fake ads that are virtually identical to legitimate brands.
- Gen Digital’s response centers on its unique data advantage. The company analyzes real-time signals across security, identity, devices and financial activities from nearly 100 million active financial accounts and over 500 million protected endpoints. This scale allows Gen Digital to detect threats earlier and adapt defenses faster than competitors.
- Gen Digital recently launched the world’s first Agent Trust Hub, allowing users to scan AI skills for risk before execution.
- The company also introduced Norton Neo, billed as the world’s first safe AI browser, which has seen strong adoption.
The next frontier is AI agents. Millions of people already use AI assistants to browse, shop and manage accounts.
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What the Model Says for Gen Digital Stock
We analyzed Gen Digital as it transforms from a pure-play cybersecurity provider into a broader digital safety and financial wellness platform.
The company benefits from multiple growth drivers.
- Traditional cyber threats continue rising, but Gen Digital is also positioned for the AI agent revolution.
- As autonomous systems become embedded in daily life, security cannot be optional. Gen Digital’s early moves into AI safety create a potential competitive moat.
- The MoneyLion acquisition adds another dimension. This business is growing revenue by nearly 40% annually while providing Gen Digital with access to consumer financial data, strengthening its overall platform.
- Engine, the company’s marketplace, now processes over 360 million inquiries annually across an expanding range of financial product categories.
Using a forecast of 11.6% annual revenue growth and 51.8% operating margins, our model projects the stock will rise to $29 within 2.1 years. This assumes an 8x price-to-earnings multiple.
That represents significant compression from Gen Digital’s historical P/E averages of 10.9x (one year) and 11.9x (five years). The lower multiple acknowledges near-term uncertainty around consumer spending and the competitive cybersecurity landscape.
The real value lies in capturing the convergence of cyber safety and financial wellness. Customers come to Gen Digital primarily to protect against financial damage.
With MoneyLion integrated, Gen Digital can now help customers both protect and improve their financial position.
Our Valuation Assumptions
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Our Valuation Assumptions
TIKR’s Valuation Model lets you plug in your own assumptions for a company’s revenue growth, operating margins, and P/E multiple, and calculates the stock’s expected returns.
Here’s what we used for GEN stock:
1. Revenue Growth: 11.6%
Gen Digital’s growth centers on structural shifts in demand. The company delivered 27% bookings growth in Q3 (10% on a pro forma basis, including MoneyLion).
Management expects this momentum to continue as scam activity accelerates and AI adoption creates new security needs.
The MoneyLion business alone is growing nearly 40%, well above the 30% long-term target set by management.
Even as this business scales, it should continue outpacing the core cybersecurity segment.
Revenue synergies are just beginning. Gen Digital is embedding MoneyLion’s financial tools into Norton and LifeLock apps, creating new monetization opportunities. The company plans to size these synergies after fiscal 2026, likely in May.
2. Operating margins: 51.8%
Gen Digital has maintained operating margins above 50% while investing in AI and platform integration. The company’s modular technology stack enables it to efficiently add features across brands.
Cyber Safety margins stand at 61%, while Trust-Based Solutions margins are 30%.
As MoneyLion scales and Gen Digital realizes cross-sell synergies, blended margins should remain healthy even with continued investment in AI capabilities.
3. Exit P/E Multiple: 8x
The market values Gen Digital at 10.9x its current earnings. We assume the P/E will compress to 8x over our forecast period, reflecting a cautious stance given the competitive environment and execution risks around the MoneyLion integration.
However, if Gen Digital successfully demonstrates that cyber safety and financial wellness truly converge in customers’ minds, the company could command a premium over traditional cybersecurity peers.
The platform approach with 78 million customers and massive data scale provides the defence that pure-play competitors lack.
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What Happens If Things Go Better or Worse?
Cybersecurity companies face competitive pressures and challenges with customer acquisition costs. Here’s how Gen Digital stock might perform under different scenarios through March 2030:
- Low Case: If revenue growth moderates to 7% and net income margins compress to 33.1%, investors still see a 13% total return (3% annually).
- Mid Case: With 7.7% growth and 34.7% margins, we expect a total return of 37% (8% annually).
- High Case: If AI agent security drives 8.5% revenue growth while Gen Digital maintains 35.8% margins, total returns could reach 62% (12% annually).
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The range reflects execution on AI security products, successful MoneyLion integration, and Gen’s ability to capture revenue synergies across its platform.
In the low case, competitive pressures intensify or consumers resist bundled offerings.
In the high case, the AI agent opportunity proves larger than expected, and financial wellness adoption accelerates ahead of schedule.
How Much Upside Does Gen Digital Stock Have From Here?
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- Operating Margins
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
