- If you are wondering whether Ziff Davis is attractively priced or not, its recent share moves and mixed track record give plenty to think about before you decide what the stock is worth to you.
- The share price closed at US$43.65 recently, with returns of 57.9% over the past week, 25.4% over the last 30 days, 28.4% year to date, 11.5% over 1 year, and longer term returns of a 42.6% decline over 3 years and a 57.5% decline over 5 years.
- Recent news flow around Ziff Davis has focused on the business as a digital media and internet company and how its portfolio of online brands and subscription services positions it within the broader communications and media sector. This context matters, because shifting sentiment around digital advertising, subscriptions and related business models often feeds directly into how investors price companies like Ziff Davis.
- On Simply Wall St's valuation checks, Ziff Davis scores 2 out of 6, and you can see the full breakdown in its valuation score. Next we will look at how methods such as discounted cash flow (DCF) analysis and valuation multiples treat the stock, then finish with a more complete way to think about what the company might be worth overall.
Ziff Davis scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.
Approach 1: Ziff Davis Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow model estimates what a business could be worth by projecting its future cash flows and then discounting those back to today using a required rate of return. It is essentially asking what those future dollars are worth in current terms.
For Ziff Davis, the model uses a 2 Stage Free Cash Flow to Equity approach based on cash flow projections. The latest twelve month free cash flow is about $291.9 million. Analyst inputs cover the next few years, with Simply Wall St extending the forecasts out to 10 years, including a projected free cash flow of $380.6 million in 2035, all in dollar terms.
Putting those projected cash flows together and discounting them back results in an estimated intrinsic value of about $118.71 per share. Compared to the recent share price of $43.65, the DCF output suggests the stock is 63.2% undervalued according to this model.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Ziff Davis is undervalued by 63.2%. Track this in your watchlist or portfolio, or discover 47 more high quality undervalued stocks.
Approach 2: Ziff Davis Price vs Earnings
For profitable companies, the P/E ratio is a common way to think about valuation because it links what you pay for the stock to the earnings the business is currently generating. Investors usually expect higher P/E ratios when they see stronger growth potential or lower risk, and lower P/E ratios when they see weaker growth or higher risk.
Ziff Davis currently trades on a P/E of 34.71x. That sits above the Interactive Media and Services industry average P/E of 16.20x and above the peer average of 14.11x. On those simple comparisons alone, the stock looks expensive relative to many other companies in its space.
Simply Wall St also calculates a “Fair Ratio” of 27.44x for Ziff Davis. This is a proprietary estimate of what a more typical P/E might be, given factors such as the company’s earnings growth profile, profit margins, industry, market cap and specific risks. Because it is tailored to the company rather than just using broad group averages, it can be more informative than a basic peer or industry comparison. With the current P/E of 34.71x sitting above the Fair Ratio of 27.44x, this approach indicates that the shares may be overvalued on earnings.
Result: OVERVALUED
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Upgrade Your Decision Making: Choose your Ziff Davis Narrative
Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, which are simple stories you create about a company that tie your view of its business to specific assumptions for future revenue, earnings, margins and a fair value estimate.
A Narrative connects three things: what you think is happening with the business, the forecast that flows from that view, and the fair value that drops out of those numbers, so you are not just reacting to ratios like the P/E in isolation.
On Simply Wall St, Narratives sit inside the Community page and are designed to be easy to use. They help you compare your Fair Value to the current share price so you can decide whether you see a potential opportunity or risk, and they update automatically as new earnings, news or other data are added.
For Ziff Davis, for example, one Narrative might see a Fair Value of about US$35.00 based on more cautious assumptions, while another sees about US$59.09 based on a more optimistic view. By comparing those stories and numbers side by side you can decide which version, if any, fits your own expectations best.
For Ziff Davis, here are previews of two leading Ziff Davis Narratives:
Fair Value: US$59.09 per share
Current price vs this Fair Value: about 26.1% below the narrative Fair Value
Revenue growth assumption: 4.41% per year
- Assumes stronger monetization of first party data and AI tools, with clearer segment disclosures helping investors value each business line more confidently.
- Sees recurring revenue from subscriptions, data licensing and targeted M&A as a key support for higher earnings and margins over time.
- Flags meaningful risks around privacy regulation, heavier use of generative AI in search, and reliance on acquisitions that could make earnings more volatile.
Fair Value: US$43.43 per share
Current price vs this Fair Value: about 0.5% above the narrative Fair Value
Revenue growth assumption: 2.88% per year
- Assumes steadier, more moderate growth as digital content, SaaS and subscriptions support recurring revenue and margins, but without a large valuation gap.
- Highlights dependence on acquisitions and pressures on digital advertising as reasons to treat future earnings and organic growth assumptions cautiously.
- Points to traffic, AI content aggregation and shifting ad budgets as ongoing headwinds that could limit how much value investors are willing to place on the shares.
Do you think there's more to the story for Ziff Davis? Head over to our Community to see what others are saying!
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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