Varonis Systems (NASDAQ:VRNS) Shares Gap Down on Analyst Downgrade

Varonis Systems, Inc. (NASDAQ:VRNS) shares gapped down prior to trading on Wednesday after Wedbush lowered their price target on the stock from $53.00 to $35.00. The stock had previously closed at $26.53, but opened at $23.17. Wedbush currently has an outperform rating on the stock. Varonis Systems shares last traded at $21.5470, with a volume of 1,820,645 shares changing hands.

A number of other research analysts have also recently issued reports on the company. Needham & Company LLC cut their price target on Varonis Systems from $55.00 to $30.00 and set a “buy” rating for the company in a report on Wednesday. Royal Bank Of Canada dropped their price target on Varonis Systems from $60.00 to $41.00 and set an “outperform” rating on the stock in a research note on Monday, January 5th. Zacks Research upgraded Varonis Systems from a “strong sell” rating to a “hold” rating in a research note on Tuesday, November 11th. Robert W. Baird downgraded Varonis Systems from a “strong-buy” rating to a “hold” rating in a report on Wednesday, October 29th. Finally, Truist Financial dropped their price objective on shares of Varonis Systems from $42.00 to $34.00 and set a “buy” rating on the stock in a research report on Wednesday. Fifteen analysts have rated the stock with a Buy rating, six have issued a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat, Varonis Systems has an average rating of “Moderate Buy” and a consensus target price of $48.20.

Key Headlines Impacting Varonis Systems

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

• Positive Sentiment: Q4 results beat consensus — EPS $0.08 vs. $0.03 expected and revenue $173.4M vs. $168.7M expected; ARR and SaaS metrics improved and cash flow rose year‑over‑year. Read More.
• Positive Sentiment: FY‑2026 guidance showed a pivot toward profitability (EPS $0.06–$0.10 vs. street at −$0.06) and raised revenue outlook ($722–$730M vs. $718M consensus) — this suggests management expects acceleration from the SaaS transition. Read More.
• Positive Sentiment: Acquisition of AllTrue.ai (AI TRiSM) to extend Varonis into AI security — reported valuation ~$150M, which could help monetize AI governance demand and complement data/access controls. Read More.
• Neutral Sentiment: Analysts trimmed price targets but kept buy ratings — Needham cut its target from $55 to $30; Truist cut from $42 to $34. These cuts reduce upside expectations even though the ratings remain constructive. Read More.
• Negative Sentiment: Multiple law firms have filed or solicited lead‑plaintiff cases alleging disclosure issues tied to the SaaS transition; an active litigation pipeline raises legal risk and potential distraction/costs. Read More.
• Negative Sentiment: Analyst/coverage and deep‑dive pieces highlight margin pressure from the SaaS transition and execution risk — investors remain sensitive to growth vs. margin tradeoffs as Varonis shifts revenue mix. Read More. Read More.

Hedge Funds Weigh In On Varonis Systems

A number of large investors have recently made changes to their positions in the stock. Dynamic Technology Lab Private Ltd bought a new stake in Varonis Systems during the first quarter valued at approximately $233,000. Caxton Associates LLP bought a new position in Varonis Systems in the first quarter worth about $200,000. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC increased its holdings in shares of Varonis Systems by 11.7% in the 1st quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 619,257 shares of the technology company’s stock worth $25,049,000 after purchasing an additional 64,636 shares in the last quarter. Mirae Asset Global Investments Co. Ltd. boosted its position in shares of Varonis Systems by 48.4% during the second quarter. Mirae Asset Global Investments Co. Ltd. now owns 12,562 shares of the technology company’s stock valued at $638,000 after buying an additional 4,097 shares during the last quarter. Finally, KLP Kapitalforvaltning AS boosted its holdings in shares of Varonis Systems by 6.5% during the 2nd quarter. KLP Kapitalforvaltning AS now owns 23,000 shares of the technology company’s stock valued at $1,167,000 after acquiring an additional 1,400 shares during the last quarter. 95.65% of the stock is owned by institutional investors.

Varonis Systems Stock Performance

The business’s 50-day simple moving average is $32.99 and its 200 day simple moving average is $45.77. The company has a debt-to-equity ratio of 0.75, a quick ratio of 1.81 and a current ratio of 1.81. The firm has a market cap of $2.69 billion, a P/E ratio of -21.79 and a beta of 0.58.

Varonis Systems (NASDAQ:VRNS) last posted its quarterly earnings results on Tuesday, February 3rd. The technology company reported $0.08 EPS for the quarter, beating analysts’ consensus estimates of $0.03 by $0.05. Varonis Systems had a negative return on equity of 21.91% and a negative net margin of 18.82%.The business had revenue of $173.37 million for the quarter, compared to analysts’ expectations of $168.66 million. During the same period last year, the firm earned $0.18 earnings per share. The business’s quarterly revenue was up 9.4% on a year-over-year basis. Varonis Systems has set its FY 2026 guidance at 0.060-0.100 EPS and its Q1 2026 guidance at -0.060–0.050 EPS. As a group, equities analysts predict that Varonis Systems, Inc. will post -0.83 earnings per share for the current year.

About Varonis Systems

Varonis Systems is a cybersecurity firm specializing in the protection and management of unstructured data. The company’s flagship Data Security Platform provides advanced analytics for monitoring file systems, email servers, collaboration platforms and cloud storage. By continuously mapping and analyzing data permissions and user behavior, Varonis enables organizations to detect insider threats, verify compliance and remediate exposed data in real time.

Founded in 2005 and headquartered in New York City, Varonis serves a diverse global customer base across financial services, healthcare, media, manufacturing and government.