As 2024 drew to a close, Warren Buffett’s Berkshire Hathaway (BRK.A) (BRK.B) doubled down on its largest internet holding, VeriSign (VRSN). From Dec. 26 through Dec. 30, Berkshire acquired an additional 76,487 shares worth $15.6 million, bringing its total stake in the internet company to 13.2 million shares valued at approximately $2.7 billion. This vote of confidence from the Oracle of Omaha has thrust VeriSign into the spotlight as a potential dark horse for 2025.
VeriSign operates as the backbone of the internet, managing .com and .net domains and running critical infrastructure like two of the 13 global root servers. The domain name industry, VeriSign’s core market, continues to grow steadily. By the third quarter of 2024, there were 362.3 million registered domains globally — a 0.8% year-over-year increase — and the broader domain tools market is projected to grow at a CAGR of 10.2% through 2030.
Despite underperforming the S&P 500 Index ($SPX) last year with only a 2% gain compared to the S&P 500’s ($SPX) 23%, Citi analysts have named VeriSign a top pick for 2025. They set a price target of $238, indicating potential upside of 14%, with an optimistic scenario suggesting gains of over 50%. Let’s examine the stock to see what makes it stand out.
The Numbers Behind VeriSign’s Market Dominance
VeriSign (VRSN), founded in 1995 as a spinoff from RSA Security, has grown into a key player in the internet infrastructure space. The company manages the .com and .net domain registries and plays a vital role in maintaining the Domain Name System (DNS), ensuring the internet runs smoothly.
Over the past year, VeriSign’s stock has demonstrated resilience, climbing from a 52-week low of $167.04 in May 2024 to a high of $213.62 in January 2025. More recently, the stock has gained 20% over six months, closing at $211.67 as of Jan. 8, 2025.
Despite these gains, VeriSign’s forward price-earnings (P/E) ratio stands at 26.41x — below its 5-year average of 31.24x — indicating potential undervaluation relative to its historical values.
VeriSign’s financial performance backs its solid reputation. In Q3 2024, the company reported $391 million in revenue, up 3.8% year-over-year, alongside $201 million in net income and diluted earnings per share of $2.07 — up from $1.83 the previous year.
Operating income grew to $269 million, and operating cash flow reached $253 million for the quarter. For the full year 2024, VeriSign projects revenue between $1.554 billion and $1.559 billion, demonstrating steady expansion in its core business.
The company’s financial strength is further evidenced by its robust cash flow generation, with $253 million in operating cash flow for the third quarter of 2024. This strong cash position has enabled VeriSign to maintain an aggressive share repurchase program with $1.28 billion remaining for future buybacks as of September 2024. These factors — combined with Warren Buffett’s increased stake and positive industry trends — highlight why VeriSign continues to attract attention as a stable-yet-promising investment opportunity heading into 2025.
What Makes VeriSign a Growth Powerhouse?
VeriSign has recently made significant moves highlighting its potential for steady growth in 2025 and beyond. One of the most significant recent developments is the renewal of VeriSign’s .com Registry Agreement with ICANN in late 2024. This agreement secures VeriSign’s exclusive rights to manage the .com domain through 2030, maintaining its ability to implement price increases tied to the U.S. Consumer Price Index.
This pricing power is critical — VeriSign raised the wholesale price of .com domains by 7% to $10.26 in September 2024, directly contributing to revenue growth despite a slight decline in domain registrations. The renewal also includes commitments to enhance security and mitigate DNS abuse, solidifying VeriSign’s reputation as a reliable steward of internet infrastructure.
Investor confidence in VeriSign remains strong, with Warren Buffett’s Berkshire Hathaway increasing its stake in late 2024. Berkshire now holds nearly 14% of VeriSign’s shares, valued at approximately $2.7 billion. This aligns with Buffett’s preference for companies with strong competitive advantages and consistent cash flow generation, further solidifying VeriSign’s position as a stock to watch in the coming year.
Citi’s Bold Predictions and the Road Ahead
Looking ahead, analysts remain optimistic about VeriSign’s prospects. Citi analysts have named VeriSign a top pick for 2025, assigning a price target of $238, representing potential upside of 14% from current levels. In their most optimistic scenario, Citi projects the stock could reach $312, representing upside of over 50%.
This positive outlook is based on VeriSign’s “almost utility-like nature” in the internet infrastructure landscape and its ability to consistently pass on price increases, leading to resilient top-line growth.
The broader analyst consensus strongly supports this positive outlook. Based on recent ratings, VeriSign maintains a “Strong Buy” consensus. The mean price target across analysts is $244, representing 17% upside from the current price.
Conclusion
VeriSign may not be the flashiest name in tech, but Warren Buffett clearly sees something special here. With Citi’s new $238 price target promising a 14% jump, and profit margins among the highest in the S&P 500, this domain registry giant seems primed for a strong 2025. Thanks to its near-monopoly on .com and .net domains (talk about “domain dominance”) and the power to raise prices, VeriSign could be the quietly snoozing tech stock about to .com to life.
