Varonis (NASDAQ: VRNS) stock surged 12.9% following a solid second-quarter earnings report. The company exceeded Wall Street's revenue and earnings per share (EPS) expectations. The company also provided optimistic revenue guidance for the third quarter, exceeding analyst expectations, with solid contributions expected from the federal government vertical.
Full-year revenue guidance was also raised, surpassing consensus estimates. Investors see these positive developments as significantly impacting the company’s prospects and growth potential.
Varonis stock has gained 19.9% year-to-date, reaching a new 52-week high of $53.30 per share.
Who Is Varonis?
Varonis, based in New York City with R&D in Israel, specializes in data security and analytics software. Its fully automated Data Security Platform (DSP) analyzes data, user behavior, and account activity to protect companies and their data from cyber threats. The company provides solutions for data protection, governance, privacy, Zero Trust, compliance, classification, and threat detection and response.
The company has a dozen offices worldwide and serves more than 7,000 customers. Recent Varonis initiatives include enhanced data security for Snowflake users and a strategic partnership with Microsoft to enable customers to safely roll out Microsoft Copilot for Microsoft 365.
Varonis has been transitioning to a subscription-based model, with the SaaS mix reaching 66% of revenues in the previous quarter. The success of Varonis's transition to a SaaS model and its potential to benefit from AI advancements are highlighted as key factors in the company's positive outlook.
Where To Go From Here
Despite the positive earnings report and outlook, Varonis has faced some challenges in the past, including missing full-year revenue guidance in a previous quarter. Shares have also been highly volatile over the past year, with six moves greater than 5%. Even so, the consensus analyst rating for VRNS is a Strong Buy.
Daniel Ives of Wedbush upgraded Varonis stock from Neutral to Outperform, raising the price target from $35 to $65, suggesting a potential 30% upside. Ives cited the company's successful model transition and potential benefits from the "AI Revolution" as reasons for the upgrade.
Neither Julie Stoller nor Stocks.News have positions in this company.
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Julie Stoller
Contributing Writer
As a professional writer since 2012, Julie Stoller has covered many industries, from healthcare and technology to consumer products and industrials. She has written about IPOs, spinoffs, ETFs, stock splits, commodities, legislative actions impacting investors, and macroeconomic issues. While keeping up with the latest meme stocks and trends, Julie's special interests are discovering ...