VeriSign (VRSN) Last Update 5/23/24
Related: EBAY GOOG AMZN AKAM
% of Stock Price
Revenue
Gross Profits
Free Cash Flow
VeriSign
STOCK PRICE
DIVISION
% of STOCK PRICE
Domain Names
100.0%
$217
Net Debt
4.0% $9
TOTAL
100%
$217
$208.33
Yours
Trefis Price
N/A
$171
Market
 
Top Drivers for Period
Key Drivers
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TREFIS Analysis


Trefis Report
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RECENT NEWS AND ANALYSIS

Potential upside & downside to trefis price

VeriSign Company

VALUATION HIGHLIGHTS

  1. Domain Names constitute 100% of the Trefis price estimate for VeriSign's stock.

WHAT HAS CHANGED?

VRSN Stock Performance

VRSN stock has seen a decline of 20% from levels of $215 in early January 2021 to around $175 now (late May 2024), vs. an increase of about 40% for the S&P 500 over this roughly three-year period.

However, the decrease in VRSN stock has been far from consistent. Returns for the stock were 17% in 2021, -19% in 2022, and 0% in 2023. In comparison, returns for the S&P 500 have been 27% in 2021, -19% in 2022, and 24% in 2023 — indicating that VRSN underperformed the S&P in 2021 and 2023.

Q1'24 Earnings

VeriSign reported net sales of $384 million in Q1'24, up 5.5% from the prior year quarter. Operating income rose from $241 million to $259 million over this period. VeriSign's EPS rose to $1.92 from $1.79 in Q1'23.

POTENTIAL UPSIDE & DOWNSIDE TO TREFIS PRICE

Below are key drivers of VeriSign's value that present opportunities for upside or downside to the current Trefis price estimate for VeriSign:

.com & .net domain names

  • Number of .com and .net domain registrations: With more and more businesses getting listed on the internet, .com, and .net domain registrations have been on the rise. The total number of domain names figure stood at 174 million in 2022, and we expect it to reach around 235 million through the forecast period. However, if the growth rate exceeds our expectations and the registration count reaches nearly 300 million, there could be a 15% upside to the Trefis price estimate for VeriSign's stock. On the other hand, the increase in domain name prices could reduce the demand for .com and .net domain names. There could be a downside of nearly 10% to the Trefis price estimate for VeriSign's stock if the registration count grows slower than expected and reaches only 200 million by the end of the Trefis forecast period.

For additional details, select a driver above or select a division from the interactive Trefis split for VeriSign at the top of the page.

BUSINESS SUMMARY

Historically, VeriSign had two main businesses - Domain Names & SSL and Authentication Services. The company sold its SSL and Authentication Services business to Symantec in May 2010 for $1.28 billion.

Domain Names:

Within this business, VeriSign controls the rights to the exclusive registry of .com and .net Internet domain names. VeriSign collects a fixed fee each time individuals or businesses register a new .com or .net domain name, or renew the registration of an existing domain name.

SOURCES OF VALUE

The source of value for the Domain Name division comes from the following:

Large Market for .com and .net Domain Names

The total domain name base for .com and .net stood at 174 million at the end of 2022. For 2023, we expect a total of around 179 million .com and .net domain names. VeriSign charges $8.20 for .com and .net per year currently.

Icann (The Internet Corporation for Assigned Names and Numbers) recently approved a 7% increase in pricing. This should be reflected in the company's pricing policies in the coming quarters.