Head-To-Head Analysis: Varonis Systems (NASDAQ:VRNS) vs. Domo (NASDAQ:DOMO)

Domo (NASDAQ:DOMO) and Varonis Systems (NASDAQ:VRNS) are both technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, valuation, earnings, profitability, institutional ownership and dividends.

Volatility & Risk

Domo has a beta of 1.76, meaning that its stock price is 76% more volatile than the S&P 500. Comparatively, Varonis Systems has a beta of 0.77, meaning that its stock price is 23% less volatile than the S&P 500.

Earnings & Valuation

This table compares Domo and Varonis Systems”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Domo	$318.86 million	0.49	-$59.34 million	($1.33)	-2.61
Varonis Systems	$623.53 million	8.97	-$129.32 million	($1.23)	-39.58

Domo has higher earnings, but lower revenue than Varonis Systems. Varonis Systems is trading at a lower price-to-earnings ratio than Domo, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Domo and Varonis Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Domo	-13.37%	N/A	-25.31%
Varonis Systems	-20.55%	-19.18%	-5.97%

Institutional and Insider Ownership

76.6% of Domo shares are held by institutional investors. Comparatively, 95.7% of Varonis Systems shares are held by institutional investors. 13.3% of Domo shares are held by insiders. Comparatively, 3.0% of Varonis Systems shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Domo and Varonis Systems, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Domo	4	4	1	0	1.67
Varonis Systems	1	19	6	0	2.19

Domo currently has a consensus target price of $3.95, indicating a potential upside of 13.79%. Varonis Systems has a consensus target price of $50.89, indicating a potential upside of 4.55%. Given Domo’s higher possible upside, analysts plainly believe Domo is more favorable than Varonis Systems.

Summary

Varonis Systems beats Domo on 7 of the 13 factors compared between the two stocks.

About Domo

Domo, Inc., together with its subsidiaries, operates a cloud-based business intelligence platform in North America, Western Europe, Canada, Australia, and Japan. Its platform digitally connects from the chief executive officer to the frontline employee with the various people, data, and systems in an organization, as well as giving them access to real-time data and insights, and allowing them to manage business via various browsers and visualization engines accessible across laptops, TV screens, monitors, tablets, and smartphones. The company was formerly known as Domo Technologies, Inc. and changed its name to Domo, Inc. in December 2011. Domo, Inc. was incorporated in 2010 and is headquartered in American Fork, Utah.

About Varonis Systems

Varonis Systems, Inc. provides software products and services that allow enterprises to manage, analyze, alert, and secure enterprise data in North America, Europe, the Middle East, Africa, and internationally. Its software enables enterprises to protect data stored on premises and in the cloud, including sensitive files and emails; confidential personal data belonging to customers, and patients and employees' data; financial records; source code, strategic and product plans; and other intellectual property. It offers DatAdvantage that captures, aggregates, normalizes, and analyzes every data access event for users on Windows and UNIX/Linux servers, storage devices, email systems, intranet servers, cloud applications, and data stores; and DatAlert that profiles users, devices, and their behaviors related to systems and data, detects and alerts on deviations that indicate compromise, and provides a web-based dashboard and investigative interface. It also provides data Classification engine that identifies and tags data based on criteria set in various metadata dimensions, as well as provides business and information technology (IT) personnel with actionable intelligence about data; and DataPrivilege. In addition, the company offers Data Transport Engine, an execution engine that unifies the manipulation of data and metadata, translating business decisions, and instructions into technical commands, such as data migration or archiving; and DatAnswers that provides search functionality for enterprise data. It serves its products to financial services, public, healthcare, industrial, technology, insurance, energy and utilities, consumer and retail, education and construction, and engineering sectors. The company sells its products through a network of distributors and resellers. Varonis Systems, Inc. was incorporated in 2004 and is headquartered in New York, New York.