Key Stats for VeriSign Stock
- Price Change: -8.1%
- Current Price: ~$223
- Advanced Model Target: $305
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What Happened?
Shares of VeriSign, Inc. (VRSN) dropped 8.1% to close at $223 on Friday, reacting to a lackluster earnings report that highlighted a structural slowdown in new domain registrations.
The company, which operates the exclusive registry for .com and .net domains, warned that the “post-pandemic” boom in website creation has officially ended.
Management cited a shift in small business behavior, noting that many entrepreneurs are now launching their presence directly on TikTok, Instagram, or Shopify subdomains rather than buying a standalone “.com” address.
Despite the headwinds, VeriSign maintained its incredible profitability, reporting operating margins above 67%, a testament to its monopoly status on the internet’s most valuable real estate.
Analysts at Baird downgraded the stock, arguing that without pricing power or volume growth, the stock deserves a lower multiple.
Conversely, Berkshire Hathaway remains a major holder, likely betting on the company’s aggressive share buyback program to support earnings per share (EPS) growth even as revenue stagnates.
The selloff has pushed the stock into “value territory” for the first time in years, attracting dividend growth investors looking for stability in a volatile tech market.
With the stock now trading near 52-week lows, the debate is whether the “.com” brand is a fading legacy asset or an eternal utility.
See analysts’ growth forecasts and price targets for VeriSign stock (It’s free!) >>>
Is VeriSign Undervalued Today?
During the earnings call, CEO Jim Bidzos addressed the concerns about alternative platforms eating into domain demand.
He stated: “While social media is a powerful tool… we continue to believe that a .com domain is the ultimate anchor for a digital identity and brand trust.”
Regarding pricing strategy, management remained tight-lipped but hinted at future increases as allowed by their government contract.
He noted: “Our contract allows for price increases… the first opportunity to take advantage of that would be an announcement made in April.”
The leadership team is focused on maintaining their “100% uptime” record, ensuring that the backbone of the internet remains secure and reliable.
Read the full VeriSign Transcript on TIKR to see the Pricing Strategy >>>
According to TIKR’s Advanced Valuation Model, the market’s pessimism has created a rare entry point for this high-quality compounder.
- Target Price: $305
- Current Price: ~$223
- Potential Upside: +26%
Valuation Model Deep Dive
The investment case for VeriSign is a play on “digital infrastructure” stability rather than hyper-growth.
The model suggests that even with slow top-line growth, the company’s massive buybacks and margins support a higher share price.
- The Fair Value Gap: At $223, the stock trades at a discount to the $305 target, offering 26% upside as the market digests the cyclical weakness.
- The Growth Reality: The model forecasts a steady 6.4% Revenue CAGR (historical 5-year), assuming modest price hikes offset flat volume.
- The Profitability Check: With Net Income Margins exceeding 50%, VeriSign remains one of the most profitable companies in the world, generating ample cash to retire shares.
If VeriSign can navigate the current soft patch and exercise its pricing power, the gap to $305 should close steadily over time.
Conclusion: The internet’s toll road is on sale. With a 25.6% upside potential to $305, VeriSign offers a defensive “sleep well at night” investment for those willing to look past the short-term noise.
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How Much Upside Does VeriSign Stock Have From Here?
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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!
