GEN — Gen Digital Inc.
Snapshot dated August 27, 2026.
Gen Digital Inc. operates as a global consumer security and identity protection company, formed through the merger of NortonLifeLock and Avast. Its primary revenue streams come from subscriptions for its flagship software products, including Norton, Avast, LifeLock, Avira, AVG, and CCleaner. The company divides its operations into two main segments: Consumer Security, which provides antivirus and online privacy protection, and Identity & Information Protection, which includes tools for credit monitoring and identity theft restoration. Gen Digital serves over 500 million users worldwide, positioning it as a significant player in the consumer-focused cybersecurity market. It competes against various global cybersecurity firms and standalone utility software providers. Recently, the company has focused on integrating its combined product portfolios to streamline cross-selling opportunities across its diverse user base.
Fair Value / Share
$27.17
Price on August 27, 2026
$30.26
Margin of Safety
-10.21%
Data by Equibles and SEC filings. Figures are as of August 27, 2026 and are not live.
Earnings Yield
Earnings Yield shows how much profit a company generates relative to its share price. EPS ÷ Stock Price.
Stock Price
$30.26
Market Cap
$18,246,780,000
Net Income (TTM)
$1,053,000,000
Diluted Shares
603.0 million
EPS (TTM)
$1.75
Earnings Yield
5.77%
AI Analysis
Gen Digital Inc. currently presents an earnings yield of 5.77%, which is calculated by taking its EPS of $1.75 and dividing it by its stock price of $30.26. This figure sits above the 4-5% return available from safe alternatives like bonds. Mechanically, this yield implies that the market is pricing the stock based on current earnings levels without as heavy an expectation for future earnings growth as seen in lower-yielding assets. If the stock price increases while earnings remain static, the earnings yield will compress toward the bond benchmark. Conversely, if earnings decline, the yield would rise unless the stock price also falls. This measure does not capture the company's long-term competitive dynamics, future capital expenditure requirements, or potential changes in its debt profile.
Return on Capital
EBIT ÷ (Net Working Capital + Net Fixed Assets) — how efficiently the business turns capital into profit.
EBIT (TTM)
$2,117,000,000
Net Working Capital
-$1,837,000,000
Net Fixed Assets
$70,000,000
Invested Capital
-$1,767,000,000
Return on Capital
Capital-free operations
This business operates on negative invested capital — customers pay in advance, so the business funds itself rather than tying up capital. Combined with positive EBIT, that is the strongest possible outcome in this framework, not a missing result.
AI Analysis
For Gen Digital Inc., the framework identifies a case of negative invested capital. With an EBIT of $2.1B and total invested capital of -$1.8B—comprising -$1.8B in net working capital and $70M in net fixed assets—the company operates with effectively no tied-up capital. In this framework, this is the strongest possible outcome. It indicates that the business generates significant operating profit without requiring its own capital to function, as the business is funded by factors such as deferred revenue, where customers pay for services in advance. Because the denominator is negative, a standard percentage return on capital cannot be calculated, but this result signifies an extremely efficient capital structure. This measure primarily captures capital efficiency; it does not capture future growth prospects or external market conditions. The result would shift toward a positive denominator if the company significantly increased its investment in property, plant, and equipment or reduced its reliance on customer prepayments.
Acquirer's Multiple
Enterprise Value ÷ Operating Earnings — how many years of operating earnings it would take to buy the whole business.
| Company | Operating earnings | Enterprise value | Multiple |
|---|---|---|---|
| AVAAvista Corp | $360M | $3.3B | 9.3x |
| GENGen Digital Inc. | $2.1B | $25.8B | 12.2x |
| CRWDCrowdStrike Holdings, Inc. | -$133M | $228.2B | — |
Where GEN sits: 12.2x against a peer median of 9.3x (peers: 9.3x) — 31.6% above the median.
Show the enterprise value bridge for each companyHide the enterprise value bridge
GEN
Debt $8.2B. This is the company's reported total debt — borrowings due within a year plus long-term borrowings. It carries no separately reported lease obligations.
AVA
Named as a competitor: Competes directly in consumer cybersecurity, device protection, and privacy software
Debt $226M. This is the company's reported total debt — borrowings due within a year plus long-term borrowings. It carries no separately reported lease obligations.
CRWD
Named as a competitor: Competes in endpoint security and threat protection software
Debt $746.2M. This is the company's reported total debt — borrowings due within a year plus long-term borrowings. It carries no separately reported lease obligations.
Operating earnings — GEN
AI Analysis
Gen Digital Inc. has an Acquirer's Multiple of 12.2x, calculated from an enterprise value of $25.8B and operating earnings of $2.1B. Among its competitors, AVA reports an Acquirer's Multiple of 9.3x, derived from an enterprise value of $3.3B and operating earnings of $360M. CRWD is currently losing money, so no multiple can be calculated for it. Comparing these figures, AVA holds the lowest multiple, while Gen Digital Inc. sits at 12.2x against a peer median of 9.3x, which is 31.6% above the median. The Acquirer's Multiple measures the price to purchase the business relative to its operating earnings, but it does not account for differences in capital structure or growth expectations. This comparison would shift if the companies' underlying operating profitability diverged or if their respective debt levels and cash holdings changed significantly, as those balance sheet factors directly impact the enterprise value calculation.
FS-Score
A 10-check read on financial health, across profitability, balance-sheet stability and operating momentum.
FS-Score
9/10
This company scores high on profitability, stability, and momentum.
Section 1
Current Profitability
3/3
Profitability is Strong, as the company passed all three checks by converting assets into both net income and free cash flow while maintaining high-quality earnings.
- Return on Assets is positive at 6.24%
- Free Cash Flow to Total Assets is positive at 9.77%
- Accruals show cash-backed earnings with a Cash Flow from Operations to Net Income ratio of 1.59
This score indicates the business is currently generating real cash surplus; a decline in cash flow relative to accounting net income would weaken this result.
Return on Assets (ROA > 0)
PassFree Cash Flow to Total Assets (FCFTA > 0)
PassAccruals (CFO / Net Income > 1)
PassSection 2
Stability
3/3
Stability is Strong, characterized by a managed debt load, a reduction in the share count, and a specialized liquidity profile.
- Leverage is flat year over year at 0.51
- Liquidity receives a point via exemption because while the current ratio is 0.4, current assets cover non-deferred obligations 1.3 times over
- Net Dilution is negative as share count fell to 619.0 million shares from 624.0 million shares
The stability score would be pressured if the company began increasing its long-term debt relative to its total assets or resumed net share issuance.
Change in Leverage (↓ or unchanged)
PassChange in Liquidity (↑ Current Ratio)
PassCustomers pay in advance here: 70% of what this company owes within the year is revenue it has already collected but not yet delivered, not money it has to pay out. A current ratio below 1 is how this business model works, not a warning sign — setting that revenue aside, current assets cover the remaining obligations 1.3 times over.
Net Dilution (annual diluted weighted-average shares, this year vs last)
PassSection 3
Recent Operational Improvements
3/4
Operational improvements are Strong, with the company becoming more efficient at generating sales and profits from its asset base over the last year.
- Return on Assets improved from 4.15% to 6.24%
- Free Cash Flow to Total Assets improved from 7.78% to 9.77%
- Asset Turnover increased from 0.25 to 0.32
- Gross Margin fell from 80.28% to 78.46%, failing the check
While most efficiency metrics are rising, the score suggests a slight compression in pricing power or higher production costs as seen in the gross margin decline.
Change in ROA (↑)
PassChange in FCFTA (↑)
PassChange in Gross Margin (↑)
FailChange in Asset Turnover (↑)
PassFramework conclusion
The company earned a total score of 9/10, driven by Strong performance across all three categories of profitability, stability, and operational improvement. This high score suggests that the company's financial health is robust and improving, indicating that any current cheapness in the stock price is less likely to be the result of fundamental business deterioration. The metrics demonstrate a consistent ability to generate cash and manage the balance sheet effectively.
- Return on Assets increased year over year to 6.24%
- Cash flow generation is healthy with Free Cash Flow to Total Assets at 9.77%
- Shareholders were not diluted, with the share count dropping to 619.0 million shares
- Asset Turnover improved to 0.32, reflecting better asset efficiency
Intrinsic Value (DCF)
A 10-year discounted cash flow, then the bridge from business value to value per share.
Reported cash flow → unlevered free cash flow
Free Cash Flow (reported)
$1.5B
+ After-Tax Interest Expense
$368.6M
= Unlevered Free Cash Flow
$1.9B
Business value (10-year DCF)
PV of Years 1–10
$13B
PV of Terminal Value
$11B
= Business Value
$24B
Business value → share value
Intrinsic Value (business)
$24B
+ Cash & Equivalents
$564M
− Debt
$8.2B
= Shareholders' Value
$16.4B
÷ Diluted Shares
603.0 million
= Fair Value / Share
$27.17
Divided by 603.0 million diluted shares — the weighted-average diluted count from the most recent quarterly income statement, for the quarter ended 2026-07-03.
Risk bucket → discount rate
mid (12%)
Year-1 FCF
$1.9B
Growth rate (yrs 1–10)
5%
Terminal growth (after yr 10)
3%
AI Analysis
The valuation for Gen Digital applies a mid-tier risk assessment, utilizing a 12% discount rate to balance the company's steady subscription cash flows against its significant debt load and competitive market pressures. A 5.00% annual growth rate is assumed over the next decade, reflecting moderate expansion aligned with historical organic performance and cross-selling efforts across mature cyber safety brands. This forecast is seeded with a fixed Year-1 free cash flow of $1.9B. Beyond the ten-year horizon, a fixed 3% terminal growth rate is applied to approximate long-term economic conditions; this terminal value represents 45.7% of the total business value. To derive the equity stake, cash and equivalents are added to the present value of cash flows, and $8.2B in total debt is subtracted, leaving a remainder to be divided by 603.0 million shares. This process results in a fair value per share estimate of $27.17. When measured against the current price of $30.26, the model produces a margin of safety of -10.21%, which represents the buffer between the calculated value and the market price. The final fair value estimate is most sensitive to the 5.00% growth rate; adjustments to this single assumption would produce the most significant change in the resulting share price.
Overall Verdict
How the five signals above stack up together, then the full synthesis.
Earnings Yield
5.77% vs ~4-5% bond-yield benchmark
Return on Capital
Capital-free operations — negative invested capital, positive EBIT
Acquirer's Multiple
12.2x against a peer median of 9.3x (peers: 9.3x) — 31.6% above the median.
FS-Score
9/10 — Financial rockstar
Intrinsic Value
-10.21% margin of safety
The analysis of GEN presents a distinct tension between the company's internal efficiency and the current market pricing. The FS-Score of 9/10 and the positive EBIT generated alongside negative invested capital, resulting in a GREEN Return on Capital, indicate an operationally efficient business structure that requires minimal capital deployment to function. Conversely, the valuation metrics provide a more cautious reading. While the 5.77% Earnings Yield offers a yield comparable to the bond-yield benchmark, the Acquirer's Multiple of 12.2x sits 31.6% above the 9.3x peer median, and the -10.21% Intrinsic Value margin of safety suggests the current price exceeds the calculated intrinsic floor. The framework highlights a business that demonstrates high financial health but commands a valuation that reflects this efficiency. A shift in the Acquirer's Multiple would most significantly alter this overall picture, as this metric currently drives the RED valuation signal despite the strong underlying operating performance indicated by the FS-Score and ROC.