Robinhood shares gain on Q2 beat, as user and crypto growth accelerate
On Monday, TD Cowen reiterated its confidence in Varonis Systems (NASDAQ:VRNS), maintaining a Buy rating and a $59.00 price target on the company’s stock. Currently trading at $51.02 with a market capitalization of $5.7 billion, Varonis has received strong analyst support, with consensus recommendations leaning towards Buy. According to InvestingPro data, analyst targets range from $39 to $65, suggesting varied opinions about the company’s potential. Shaul Eyal, a prominent analyst at the firm, emphasized Varonis’s position as a leading defender against data threats, which is increasingly vital as enterprises grow to value their data more. The company’s strong market position is reflected in its impressive gross profit margin of 82.3% and robust revenue growth of 13.3% over the last twelve months. Eyal believes that Varonis’s comprehensive data protection platform is well-placed to benefit from the current landscape characterized by a heightened threat environment, stricter regulations, growing data volumes, cloud migration, and the adoption of artificial intelligence. InvestingPro subscribers can access 10+ additional exclusive insights about Varonis’s financial health and market position.
Eyal noted that Varonis’s successful transition to a Software (ETR:SOWGn) as a Service (SaaS) model, completed two years ahead of schedule, is expected to contribute to the company’s performance and profitability. He underlined that this transition aligns with the broader industry’s shift towards SaaS solutions.
The price target set by TD Cowen reflects a valuation of Varonis at 9 times the firm’s estimated 2026 revenue. This valuation is a premium compared to the group average, which stands at 7.5 times the 2026 consensus revenue, and significantly higher than the median revenue multiple of 6 times within the same group. InvestingPro’s analysis indicates that the stock is currently trading above its Fair Value, with a high Price/Book ratio of 15.5x and an overall Financial Health score of FAIR.
The analyst’s outlook for Varonis is rooted in a robust analysis of the company’s market position and future revenue projections. By maintaining the price target, TD Cowen signals its belief that Varonis’s stock remains an attractive investment within the small to mid-cap (SMIDCap) sector, particularly for those looking to capitalize on the growing importance of data security in an increasingly digital and interconnected business landscape.
In other recent news, Varonis Systems reported impressive first-quarter earnings, surpassing analyst expectations. The company achieved adjusted earnings of $0.00 per share, beating the projected -$0.02, while revenue reached $136.4 million, exceeding the $129.92 million consensus estimate. Varonis also saw a significant increase in its SaaS revenues, which rose to $88.6 million from $34.0 million in the previous year, contributing to a 19% year-over-year growth in annual recurring revenue (ARR). In light of these results, Varonis has revised its full-year ARR forecast upwards, anticipating a growth of 16.2% for FY25.
Additionally, Varonis achieved a notable milestone by securing FedRAMP Authorization for its Data Security Platform, marking it as a compliant provider for federal agencies. This development is expected to strengthen Varonis’ position in the market for cloud-hosted security solutions. Meanwhile, Cantor Fitzgerald reaffirmed an Overweight rating and a $60 price target on Varonis stock, reflecting confidence in the company’s strategic direction and growth potential.
Furthermore, at its 2025 Annual Meeting of Stockholders, Varonis received approvals for several key proposals, including an increase in shares for its 2023 Omnibus Equity Incentive Plan. The company also announced the election of board nominees to serve until the 2028 Annual Meeting. These recent developments underscore Varonis’ strong financial performance and strategic advancements in the data security sector.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.