VeriSign Earnings: Continued Domain Base Expansion Drives Guidance Rise; We Increase FVE to $217

We have raised our fair value estimate for VeriSign to $217 from $210, following a solid first-quarter 2025 earnings report and an upward revision of full-year guidance by the wide-moat firm. Quarterly revenue and profitability were in line with FactSet consensus expectations. This performance was driven by modest domain base expansion and improved renewal rates. Encouraged by these trends, management raised guidance for the fiscal year to revenue of $1.635 billion to $1.650 billion (previously $1.615 billion to $1.635 billion), and operating income between $1.110 billion and $1.125 billion. We view this increase positively and believe VeriSign’s resilient business model will help it weather ongoing macroeconomic headwinds. Additionally, the firm also declared its first-ever quarterly dividend of $0.77. Our valuation model has been updated accordingly. We view the shares as slightly overvalued.