Warren Buffett‘s Berkshire Hathaway has made a significant investment in VeriSign Inc. (NASDAQ:VRSN), purchasing $74 million worth of shares.

What Happened: The conglomerate acquired approximately 377,736 shares during trading sessions leading up to Dec. 24, according to Fortune on Tuesday. This move comes despite a 2% decline in VeriSign’s stock during a booming year for tech stocks, data from Benzinga Pro revealed.

During the same period, the S&P 500 has risen 25% and the tech-heavy Nasdaq has gained 30%.

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Founded in 1995, VeriSign was a key player during the dotcom boom, primarily known for domain name registration. It plays a crucial role in Internet infrastructure by supporting DNS queries and maintaining two of the Internet’s 13 root servers. Despite its essential functions, the company’s stock has underperformed, down 1.38% year to date, compared to the S&P 500’s 25% rise and the Nasdaq’s 30% increase.

Berkshire Hathaway, which first invested in VeriSign over a decade ago, has increased its holdings to over 13 million shares, valued at approximately $2.6 billion, making it the largest shareholder. According to the report, VeriSign’s high-profit margins may be a factor in this investment decision. The company ranks fifth in profit margin among S&P 500 companies and third in operating margin among major U.S. companies.

Trending: The global games market is projected to generate $272B by the end of the year — for $0.55/share, this VC-backed startup with a 7M+ userbase gives investors easy access to this asset market.

Despite its stock lagging behind major indices, VeriSign’s essential role in internet infrastructure and its impressive profit margins make it an attractive investment for Buffett’s firm.

As per Benzinga Pro data, VeriSign has a consensus price target of $243.67 based on the ratings of three analysts. As per the most-recent analyst rating by Baird has set an average price target of $216.67 with an implied 3.67% upside for the company.

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This article Warren Buffett's Berkshire Hathaway Makes Bold $74 Million Bet On This Forgotten Darling Of Dotcom Boom originally appeared on Benzinga.com

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