⚠ Buybacks at Thirty-One Times Do Less WorkModerate threat

VeriSign (VRSN) — threat to the moat

The repurchase does least work exactly when the market is most confident, and 31 times earnings retires about 3% a year.

Buybacks do less work at thirty-one times earnings than they did at twenty-five.

Price to earnings when shares were bought back (year end)25.7x202325.3x202427.3x202531.5xNowMarket value over net income; VeriSign repurchased $858.6M in 2025 and $197M in Q2 2026
Each dollar spent on buybacks now retires about a fifth fewer shares than it did in 2024.

VeriSign has retired about a third of itself since 2015 — roughly 133 million diluted shares down to 90.3 million — and the compounding shows: net income rose about 120% over the decade while earnings per share rose 227%.1 Most of the gap was bought.

The rate depends on the price. At 25 times earnings, spending all of free cash flow retires about 4% of the company a year. At 31 times it retires about 3%.3 At 40 it would retire barely 2%. The buyback is therefore weakest exactly when the market is most confident, which is the standard problem with the policy and is not specific to VeriSign.

The company has been disciplined about the trade in the past: repurchases of $858.6 million in 2025 and $197 million in the second quarter of 2026, against an authorisation the board keeps refilling to $1.50 billion.2 It has not shown a willingness to stop when the price is high.

The number to watch is shares retired per dollar spent, not dollars spent. It has been falling.

References
  1. ReportedNet income rose about 120% between 2015 and 2025 while diluted earnings per share rose 227%, as diluted shares fell from about 133 million to 93.8 million.
    SEC EDGAR XBRL company facts for VeriSign, Inc. (CIK 1014473) — annual revenue, operating income, net income and diluted earnings per share as filed. Revenue $1,059.4M (2015) rising to $1,656.6M (2025); operating income $605.9M to $1,121.0M; net income $375.2M (2015), $440.6M (2016), $457.2M (2017), $582.5M (2018), $612.3M (2019), $814.9M (2020), $784.8M (2021), $673.8M (2022), $817.6M (2023), $785.7M (2024), $825.7M (2025); diluted EPS $2.82 (2015) to $8.81 (2025). — FY2015–FY2025 · publ. 2026-02-05 · source ↗
  2. ReportedVeriSign repurchased $197 million of stock in the second quarter of 2026 and the board restored the authorisation to $1.50 billion.
    VeriSign, Inc., Reports Second Quarter 2026 Results — Form 8-K Exhibit 99.1, 23 July 2026. Revenue $435 million, up 6.0% year over year; operating income $296 million against $281 million; net income $217 million and diluted EPS $2.38 against $207 million and $2.21. Cash, cash equivalents and marketable securities $1.03 billion, up $454 million from year-end 2025; deferred revenues $1.45 billion at 30 June 2026, up $64 million from year-end. Cash flow from operations $232 million. On 26 June 2026 VeriSign issued $550 million of 5.10% Senior Notes due 2031 and on 20 July 2026 used the proceeds with cash on hand to redeem $550 million of 4.75% Senior Notes due 2027. 0.7 million shares repurchased for $197 million; an additional $884 million authorised effective 23 July 2026 bringing the total authorisation to $1.50 billion; a quarterly dividend of $0.81 per share declared on 20 July 2026. The domain name base ended at 179.1 million .com and .net registrations, a 5.1% increase year over year and a net increase of 3.05 million in the quarter; a record 12.7 million new registrations were processed against 10.4 million; the final first-quarter 2026 renewal rate was 76.3% against 75.5%. CEO Jim Bidzos: the record of 100% availability for the .com and .net domain name resolution system was extended to 29 years, and more than 100% of free cash flow was returned to the investing public through dividends and share repurchases. The .web top-level domain has been delegated into the DNS root zone with VeriSign as the designated registry operator. — Q2 2026 · publ. 2026-07-23 · source ↗
  3. ReportedVeriSign trades at about $297 a share, a market capitalisation near $26.8 billion on 90.3 million shares, roughly 31.8 times trailing earnings and 15.7 times trailing sales, at a dividend yield of about 1.1%.
    VeriSign (NASDAQ: VRSN) market data — share price about $297 and market capitalisation about $26.8 billion on 90.3 million shares outstanding; trailing price/earnings about 31.8 and price/sales about 15.7 on trailing revenue of $1.71 billion and trailing net income of $850 million; price/book not meaningful on negative shareholders' equity; dividend yield about 1.1%. — August 2026 · publ. 2026-08-27 · source ↗
Sources
Generated September 23, 2026