VRSN: Strong Quarterly Results Will Drive Renewed Optimism Despite Bearish Sentiment

Analysts have lowered their fair value estimate for VeriSign from $304 to $295.50 per share. They cite updated forecasts and a refined assessment of domain-related revenue drivers following the company’s recent quarterly performance and related market commentary.

Analyst Commentary

Analysts have provided a range of views on VeriSign's recent performance and outlook, with particular focus on valuation, growth opportunities, and operational execution. Their commentary highlights both areas of optimism and ongoing caution regarding the company's prospects.

Bullish Takeaways

• Bullish analysts note that VeriSign delivered strong third-quarter results, surpassing prior expectations and signaling solid operational execution.
• They highlight management's updated guidance on domain growth as a positive indicator for future revenue streams and market stability.
• Current share levels are seen as creating an attractive entry point for investors. Upside potential exists if growth and execution remain on track.
• Ongoing reassessment of advertising and promotional activity is viewed as a manageable risk that has already been partially addressed in guidance and commentary.

Bearish Takeaways

• Bearish analysts express concern over changes in parked domain advertising, which could impact a key revenue source and weaken future growth trajectories.
• There are reservations about the quality of domain additions, with increased promotional activity potentially leading to lower-quality registrant trends.
• Some remain cautious following recent model updates that reflect exposure to shifts in online advertising arrangements. This adds uncertainty to the near-term outlook.
• Despite constructive management commentary, the stock has traded lower post-earnings, highlighting persistent skepticism among some market participants.

What's in the News

• VeriSign completed a share repurchase tranche between July 1 and September 30, 2025. The company bought back 763,000 shares, or 0.82% of its shares, for $215.07 million (Key Developments).
• Since initiating its buyback program on February 5, 2015, the company has repurchased a total of 55,917,000 shares. This represents 52.04% of shares for $8,367.95 million (Key Developments).

Valuation Changes

• The Fair Value Estimate has decreased from $304 to $295.50 per share following updated analysis.
• The Discount Rate has risen slightly from 9.08% to 9.17%.
• The Revenue Growth outlook remains essentially unchanged at approximately 4.69%.
• The Net Profit Margin is stable, with a negligible change from 51.86% to 51.86%.
• The future P/E multiple has fallen slightly from 33.8x to 33.0x.