Gen Digital Inc. (GENVR) stock analysis

P/E below its 5-year median

Gen Digital's P/E of 14.6 is below its own 5-year median of 18.6.

P/E below the industry

Gen Digital's P/E of 14.6 is below the Computer Programming, Data Processing, and Other Computer Related Services median of 26.0.

EV/EBITDA below its 5-year median

Gen Digital's EV/EBITDA of 9.4 is below its 5-year median of 13.2.

P/B above the industry

Gen Digital's price-to-book of 6.36 is above the Computer Programming, Data Processing, and Other Computer Related Services median of 3.29.

Trading below fair value

The share price of $29.13 is below our fair value estimate of $46.74.

Margin of safety over 20%

The price is 37.7% below fair value, more than the 20% cushion we look for.

Revenue growing 10%+ a year

Revenue grew 14.7% a year over the last three fiscal years.

EPS growing under 10% a year

Diluted EPS grew -9.8% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 112% over the last twelve months, against a 5-year average of 11.9% a year.

Growing faster than the industry

Revenue grew 16.9% over the last twelve months; the Computer Programming, Data Processing, and Other Computer Related Services median is 10.8%.

Guidance raised

Gen Digital raised its FY27 Revenue outlook on Aug 6, 2026.

Gross margin slipping

Gross margin was 77.4% over the last twelve months, against 79.3% a year earlier.

Return on equity over 15%

Return on equity was 46.4% over the last twelve months and averaged 57.3% over five years.

Return on capital over 10%

Return on invested capital was 14.7%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Gen Digital's return on equity of 46.4% is above the Computer Programming, Data Processing, and Other Computer Related Services median of -0.3%.

Earnings grew over 5 years

Net income grew 11.9% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 23.1% over the last twelve months, against a 5-year average of 24.4%.

Net margin above the industry

Gen Digital's net margin of 23.1% is above the Computer Programming, Data Processing, and Other Computer Related Services median of -4.9%.

High debt

Debt is 296% of shareholders' equity, above the 40% we consider low.

Debt trend

Needs a balance sheet from five years ago with positive equity.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 21.9% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets don't cover short-term debts

Current assets are 0.37 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 1.48; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Gen Digital paid dividends worth 1.7% of the share price over the last twelve months.

Yield below Treasuries

The 1.7% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 4.0% or more; Gen Digital yields 1.7%.

Dividend was cut

The dividend per share fell by more than 10% at least once in the last 10 fiscal years.

Covered by earnings

Dividends take 25.7% of net income.

Covered by free cash flow

Dividends take 17.6% of free cash flow.