Ziff Davis, Inc. (ZD): A Bull Case Theory

We came across a bullish thesis on Ziff Davis, Inc. on Beeli Capital’s Substack by Andrew Beeli. In this article, we will summarize the bulls’ thesis on ZD. Ziff Davis, Inc.'s share was trading at $39.60 as of January 29th. ZD’s trailing and forward P/E were 15.29 and 5.33, respectively according to Yahoo Finance.

Ziff Davis, Inc., together with its subsidiaries, operates as a digital media and internet company in the United States and internationally. ZD is a diversified roll-up of media and internet assets, owning brands like CNET, PCMag, RetailMeNot, IGN, Ookla, and Downdetector—names that are broadly familiar but not essential destinations for most users.

The bull case centers on ZD trading cheaply on a sum-of-the-parts basis and management signaling interest in potential asset sales, which could unlock meaningful value. The stock’s recent 8% move appears driven not by new disclosures but by renewed investor attention following the company’s appearance at the UBS Global Technology and AI Conference, with trading activity suggesting a few new managers initiated positions.

The core appeal is the possibility that ZD could sell $200M+ of assets at 8x EBITDA or higher, but concerns remain about revenue quality and the long-term viability of the business. ZD highlights that 42% of revenue comes from subscription and licensing, yet reported churn reflects customer turnover rather than true revenue churn, raising doubts about retention—particularly among larger business clients. More importantly, the company’s model depends heavily on consumer traffic, which faces structural risk as LLMs and AI agents change how users navigate the internet and potentially shift the locus of advertising away from traditional content sites.

Attempts to reconstruct organic revenue growth reveal inconsistencies with management’s disclosed figures, further undermining confidence in the durability of the business and transparency of reporting. Combined with an M&A-driven strategy that appears increasingly questionable given historical returns, these issues create a mixed investment profile. While a sizable divestiture could catalyze material upside, absent such action the risk of long-term erosion keeps the opportunity intriguing but not yet investable.

Previously we covered a bullish thesis on Ziff Davis, Inc. (ZD) by Value Don’t Lie in March 2025, which highlighted extreme undervaluation, high-margin stability, and improved capital allocation. The company's stock price has depreciated approximately 5.87% since coverage, as the thesis didn’t fully play out. The thesis still stands as ZD remains cheap on a sum-of-the-parts basis. Andrew Beeli shares a similar thesis but emphasizes revenue quality, subscription churn, and AI-driven structural risks.

Ziff Davis, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 24 hedge fund portfolios held ZD at the end of the second quarter which was 19 in the previous quarter. While we acknowledge the potential of ZD as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.