Varonis Systems (NASDAQ:VRNS) Stock Gets Downgrade from TD Cowen

Varonis Systems (NASDAQ:VRNS) was downgraded by equities researchers at TD Cowen from a “buy” rating to a “hold” rating in a report issued on Friday, Marketbeat Ratings reports. They currently have a $49.75 price target on the technology company’s stock, down from their previous price target of $56.00. TD Cowen’s price target suggests a potential upside of 2.11% from the stock’s current price.

Other analysts have also issued research reports about the company. Cantor Fitzgerald reiterated an “overweight” rating on shares of Varonis Systems in a report on Friday. Susquehanna increased their price target on Varonis Systems from $36.00 to $55.00 and gave the company a “positive” rating in a research report on Wednesday, July 29th. Robert W. Baird raised their price target on Varonis Systems from $40.00 to $45.00 and gave the company a “neutral” rating in a research note on Wednesday, July 29th. Truist Financial raised their price target on Varonis Systems from $34.00 to $52.00 and gave the company a “buy” rating in a research note on Tuesday, July 21st. Finally, DA Davidson reaffirmed a “neutral” rating and set a $49.75 price target (down from $55.00) on shares of Varonis Systems in a research report on Friday. Six equities research analysts have rated the stock with a Buy rating, eighteen have given a Hold rating and one has given a Sell rating to the company’s stock. Based on data from MarketBeat.com, the stock presently has an average rating of “Hold” and an average price target of $50.94.

Varonis Systems Stock Up 2.9%

NASDAQ:VRNS traded up $1.38 on Friday, hitting $48.72. 36,254,825 shares of the company’s stock were exchanged, compared to its average volume of 1,595,944. The firm has a 50-day moving average price of $45.81 and a 200-day moving average price of $37.96. The company has a debt-to-equity ratio of 1.02, a current ratio of 1.65 and a quick ratio of 1.65. Varonis Systems has a 52 week low of $19.70 and a 52 week high of $63.80. The company has a market cap of $5.60 billion, a P/E ratio of -39.61 and a beta of 0.77.

Varonis Systems (NASDAQ:VRNS) last posted its quarterly earnings data on Tuesday, July 28th. The technology company reported $0.04 EPS for the quarter, topping analysts’ consensus estimates of $0.01 by $0.03. The company had revenue of $180.02 million during the quarter, compared to the consensus estimate of $176.83 million. Varonis Systems had a negative net margin of 20.55% and a negative return on equity of 19.18%. The company’s quarterly revenue was up 18.3% on a year-over-year basis. During the same period in the prior year, the business posted $0.03 EPS. Varonis Systems has set its FY 2026 guidance at 0.140-0.150 EPS and its Q3 2026 guidance at 0.020-0.030 EPS. As a group, analysts expect that Varonis Systems will post -0.95 EPS for the current fiscal year.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently modified their holdings of the company. Pictet Asset Management Holding SA increased its stake in shares of Varonis Systems by 43.4% during the 1st quarter. Pictet Asset Management Holding SA now owns 3,123,056 shares of the technology company’s stock worth $67,029,000 after purchasing an additional 944,676 shares during the last quarter. American Capital Management Inc. raised its holdings in shares of Varonis Systems by 54.3% in the 1st quarter. American Capital Management Inc. now owns 2,328,379 shares of the technology company’s stock valued at $49,990,000 after purchasing an additional 819,340 shares during the period. Stephens Investment Management Group LLC raised its holdings in shares of Varonis Systems by 17.9% in the 1st quarter. Stephens Investment Management Group LLC now owns 1,992,760 shares of the technology company’s stock valued at $42,785,000 after purchasing an additional 302,411 shares during the period. Clal Insurance Enterprises Holdings Ltd bought a new stake in shares of Varonis Systems in the 2nd quarter valued at about $61,262,000. Finally, Senvest Management LLC lifted its stake in Varonis Systems by 406.1% in the 1st quarter. Senvest Management LLC now owns 1,448,943 shares of the technology company’s stock valued at $31,109,000 after purchasing an additional 1,162,651 shares during the last quarter. Institutional investors own 95.65% of the company’s stock.

Key Headlines Impacting Varonis Systems

Here are the key news stories impacting Varonis Systems this week:

• Positive Sentiment: The proposed acquisition removes much of the company-specific uncertainty and offers shareholders a cash consideration above Varonis’s pre-deal trading level. RBC said the combination makes strategic sense as competition in cybersecurity intensifies. RBC on Varonis Acquisition
• Neutral Sentiment: Analyst actions largely reflect the announced transaction. Citigroup, Robert W. Baird and Wedbush raised their targets to approximately $49.75-$50, while Piper Sandler, TD Cowen, Jefferies, Wells Fargo, DA Davidson and Rosenblatt reaffirmed neutral, hold or equal-weight ratings with targets near $49.75. These targets imply limited additional upside because they are close to the offer price.
• Neutral Sentiment: Unusually heavy options activity included purchases of 7,193 call contracts, about 186% above average call volume, suggesting elevated speculative interest following the deal announcement. However, options activity does not guarantee further gains.
• Negative Sentiment: RBC downgraded Varonis to Sector Perform and lowered its target to $49.75 from $52, citing the Proofpoint transaction. With the stock near the cash offer, the remaining upside is limited and depends primarily on deal completion rather than operating performance.
• Negative Sentiment: Several shareholder-rights law firms announced investigations into whether the $49.75 offer fairly values Varonis and whether the board adequately protected investors. Such reviews could create transaction uncertainty, although they do not necessarily indicate that the deal will fail. Ademi Varonis Shareholder Alert

About Varonis Systems

Varonis Systems, Inc develops data security and cyber-risk management software for organizations seeking to protect sensitive information from unauthorized access, misuse, and cyberattacks. Its platform helps customers discover and classify data, analyze access permissions, identify unusual activity, and remediate security exposures across on-premises and cloud-based environments.

The company’s offerings are designed to secure data stored in file systems, collaboration platforms, databases, email, and other enterprise repositories.