Verisign

Capital allocation has been shareholder-friendly. Management consistently invests in the core registry (maintaining world-class DNS infrastructure) and then returns excess cash. R&D and capex are modest (R&D 6% of revenue), reflecting the stable nature of the service.

The company aggressively repurchases stock when valuations are reasonable: e.g. 6.6M shares ($1.21B) retired in 2024), and a new $913M authorization was added in Q2 2025 (total $1.5B authorized). In 2025 Verisign also began paying a dividend ($0.77/quarter) after a long pause, which is a signal of capital discipline given its enormous cash flow.

Dilution is minimal: stock-based comp is small relative to buybacks (authorizing 7.3M shares remains for future employee plans)). On balance this is very efficient capital use. For buybacks plus reinvestment in a high-ROIC business, we rate 85/100.