Ziff Davis, Inc. (NASDAQ: ZD) – Digital Verticals with Real Cash Flow
Ziff Davis, Inc. (NASDAQ: ZD) is a digital media and internet holding company with a portfolio spanning technology, gaming, health, and cybersecurity. Known for properties like IGN, PCMag, AskMen, and StrongVPN, ZD operates an asset-light model with high-margin recurring revenue streams—a rarity in digital publishing and SaaS hybrids.
Formerly known as J2 Global, Ziff Davis has refocused its strategy since the 2021 spin-off of Consensus Cloud Solutions (CCSI), emphasizing disciplined M&A and operational efficiency over aggressive expansion.
The Bigger Picture: What Ziff Davis Owns
ZD’s business lines are grouped into two major segments:
- Digital Media: Brands such as IGN, Speedtest, and Mashable monetize via advertising, affiliate revenue, and subscriptions.
- Cybersecurity & Communications: Encompasses StrongVPN, IPVanish, and campaign management tools like Moz and iContact.
This mix gives Ziff Davis broad exposure to high-intent audiences and SaaS-like revenue streams with EBITDA margins north of 30%.
Key Catalysts Driving ZD’s Momentum
- Tight Cost Controls: Ziff Davis is generating over 30% adjusted EBITDA margins—leading among digital peers due to lean ops and automation.
- High Cash Conversion: With limited capex needs and consistent cash flow, ZD throws off over $250M in FCF annually.
- Smart Acquisitions: Recent tuck-in deals in security and marketing tech are adding high-ROI revenue without debt overhang.
- Undervalued Growth Model: At ~8x forward EBITDA, ZD trades like a declining media company—despite growing SaaS revenues and operating leverage.
- Balance Sheet Optionality: With under 2x net leverage and no near-term maturities, ZD has room to accelerate buybacks or pursue strategic M&A.
Technical Analysis: ZD’s Recovery Setup in Motion
- Moving Averages: ZD recently reclaimed its 200-day MA (~$58.70); current consolidation just above that level is constructive.
- MACD: Strong bullish crossover in June; histogram rising steadily.
- RSI: RSI at 57—momentum building but not overextended.
- Chart Structure: Rounded bottom formation from $50–$60; breakout target range of $67–$72.
- Volume Trends: Accumulation noted on earnings beats; institutional rotation into value tech names evident.
Potential Risks to Consider
- Ad Market Exposure: While diversified, ZD’s media unit still depends partly on digital advertising, which can be cyclical.
- Fragmented Business Mix: Operating across so many verticals can dilute focus and reduce visibility on core drivers.
- Low Growth Perception: ZD’s hybrid model isn’t well understood by the market, potentially suppressing valuation multiple.
Ziff Davis is one of the rare digital media companies with cash flow discipline, strategic M&A execution, and upside from misunderstood valuation. For investors looking at non-hype, under-the-radar tech names, ZD could be a breakout candidate in the back half of 2025