Verisign(US:VRSN) The Motley Fool·2025-01-14 01:30Core Viewpoint - Verisign has become an attractive investment opportunity due to its strong market position and steady growth in revenue and earnings, despite regulatory concerns and a stagnant stock price over the past five years [9][10]. Company Overview - Verisign holds exclusive rights to register .com and .net domain names, creating a monopoly in the domain registration market [4]. - The company can increase prices by 7% for .com and 10% for .net domains annually, which is built into its contracts with ICANN [4]. Financial Performance - Over the last decade, Verisign's revenues have increased by more than 50%, while net earnings have grown by 146%, showcasing significant operating leverage [6]. - The total number of .com and .net domains increased by 7.8% over the five-year period ending in September, indicating sustained demand [7]. Shareholder Returns - Verisign has been returning capital to shareholders through share repurchases, leading to a substantial increase in earnings per share compared to net income [8]. - The stock trades at approximately 24 times analysts' 2025 earnings expectations, which is considered a fair valuation for a company with strong growth prospects [10]. Investment Considerations - Despite steady business growth, Verisign's stock price has remained relatively flat, potentially due to regulatory concerns [9]. - Berkshire Hathaway currently owns 13.8% of Verisign, and its market capitalization of $20.3 billion limits the ability to invest significantly more [11].