A brand-new payer, covered on a fortress cash flow. VeriSign paid no dividend before 2026 and declared $0.81 a quarter in each of the first three quarters of 2026, paying $220.8 million in nine months. The annualized $3.24 is about 36.1% of fiscal 2025 free cash flow of $808 million, a pass, and net debt on a fair-value basis is about 1.4x EBITDA, a pass. But there is no five-year record, and the 0.79% trailing yield is under 1%, so the card is graded warn as a new payer and growth holding.
Key risk: There is no dividend history to lean on — one year of payments does not prove the payout survives a bad registry year, and the registry contract itself is the single point of failure.
Changes if: The $0.81 rate is raised, or the dividend is cut.
- ✓Cash-flow cover About 36.1% of FY2025 free cash flow on the annualized new rate, pass (<60%).
- ✓Leverage About 1.4x on a fair-value debt basis, pass (<3x).
- !Growth record New payer — first dividend in 2026; no 5-year record, so a caution under the filter, not a fail.
- !Trap screen Yield 0.79%, under 1% — warn as a growth holding; no cut, payout under 100%.
What this grade doesn't say: It screens the dividend only — covered, real, compounding. It says nothing about valuation or price: a well-covered payer can still be overpriced, and its price can still fall.