ZIFF DAVIS, INC. (ZD) stock intrinsic value fair value estimate & owner earnings analysis

Ziff Davis is a digital media and internet services company organized into five segments: Technology & Shopping (tech reviews, comparison shopping, and speed-testing tools), Gaming & Entertainment (including IGN and Humble Bundle), Health & Wellness (consumer health content and services), Connectivity (subscription software, including VPN tools), and Cybersecurity & Martech. A large part of revenue comes from advertising and performance marketing tied to visitors arriving through internet search, with the rest coming from subscriptions and licensing that are steadier and less exposed to how search engines route traffic. We build our estimate of value from owner earnings -- cash generated by the business after the reinvestment needed just to maintain it, and after adding back non-cash charges like depreciation, amortization, and stock-based compensation (which we then treat as a real cost and subtract back out). Over the last four full years, on a business that looks the way it does today, that figure has run in a fairly narrow band -- roughly $5.44 to $6.67 per share, with a middle value (our starting point for the valuation) of about $5.74 per share. We measure from 2022 onward because 2021 was the year the company completed the sale of its older cloud-communications business and rebranded, so the years before that describe a different, larger business, and 2021 itself was a one-time transition year distorted by that sale. Owner earnings per share grew about 16% in 2025, but a large part of that came from the company buying back roughly $174 million of its own stock during the year, which shrinks the share count and boosts the per-share number even when the underlying business grows more slowly (the business itself generated about 7% more cash in 2025 than in 2024). For the coming year we use a more conservative growth assumption of about 6%, well below the trailing per-share rate, and we do not assume buybacks continue at the recent pace indefinitely. The biggest risk we can see in the filings is that a meaningful share of revenue depends on free traffic from internet search engines, and the company specifically flags that changes to search engine algorithms and placement could reduce that traffic. This isn't hypothetical: the Technology & Shopping segment, which houses much of the advertising-driven content business, has taken goodwill write-downs in each of the last three years ($56.9 million in 2023, $85.3 million in 2024, $17.6 million in 2025) as some of those businesses have underperformed. These write-downs are not a cash cost to owner earnings, but they are a warning sign about the durability of that part of the business, so we account for it by assuming a weaker growth and terminal outlook for the company overall, rather than by changing the earnings figure itself. Our bear case assumes the search-traffic pressure keeps building over the next several years, pushing owner earnings down by a cumulative 15-20% before stabilizing at that lower level, with only a modest, likely-shrinking cash stream and no further gains from buybacks once the company prioritizes debt (roughly $867 million outstanding, against $607 million of cash, including convertible notes coming due within the next year). Our base case assumes the subscription- and health-related businesses keep growing enough to offset a struggling advertising business, with modest overall growth fading toward roughly 1% per year in the long run. Our bull case assumes the company successfully diversifies away from search-dependent advertising over time, aided by continued buybacks, sustaining somewhat higher growth. In all three cases, growth beyond the ten-year horizon is capped well below what would imply an outsized permanent growth rate, given real uncertainty about how much of the advertising business survives changes in how people find information online; even so, the value attributable to years beyond the ten-year forecast is a substantial share -- roughly 60-67% -- of our total estimate in each case, so a reader should understand that a large part of this valuation rests on a judgment about the business's staying power a decade or more from now, not just its results over the next few years. Based on this range of outcomes, the margin-of-safety price is set meaningfully below our base-case estimate -- around $95.65 per share -- to build in a margin of safety against the possibility that the advertising side of the business keeps deteriorating. A higher price would be supported once there is clear evidence the advertising and performance-marketing decline in the Technology & Shopping segment has stopped getting worse.