Varonis Systems Inc. (NASDAQ:VRNS) stock has reached a new 52-week high, touching $57.12 amidst a remarkable year of growth. Investors have witnessed the cybersecurity company's stock surge, reflecting a significant 1-year change with an impressive 90.57% increase. This peak represents a notable milestone for Varonis, as the company continues to expand its presence in the data security sector, capitalizing on the growing demand for robust protection against cyber threats. The 52-week high serves as a testament to the company's strong performance and investor confidence in its strategic direction.
In other recent news, Varonis Systems has reported impressive second-quarter results, with a notable 18% increase in Annual Recurring Revenue (ARR) to $584.2 million, driven by the company's Software-as-a-Service (SaaS) platform and its Managed Detection and Response (MDDR) solution. As a result, investment firms including FBN Securities, Truist Securities, Citi, Piper Sandler, RBC Capital Markets, TD Cowen, and JPMorgan (NYSE:JPM) have adjusted their price targets for Varonis Systems. The company's transition to a SaaS business model has been successful, with SaaS contributing to 36% of the total ARR by the end of the quarter, and Varonis aims for SaaS to comprise 48% of total ARR by the end of the year.
Varonis Systems' non-GAAP earnings per share (EPS) of $0.05 surpassed the consensus by seven cents, and the company delivered impressive performance in key areas such as ARR, ARR contribution margin, and Free Cash Flow (FCF) margin. The ARR contribution margin was reported at 14.9%, higher than estimated, and the FCF margin improved significantly to 8%, up from 4% in the previous year. The company's SaaS offerings were highlighted, with SaaS ARR now constituting 36% of the total ARR, surpassing the estimate of 35% and up from 30% in the first fiscal quarter.
These recent developments have led to several investment firms adjusting their outlook on Varonis Systems. Truist Securities raised its price target to $60, Citi increased its shares target to $50, and Piper Sandler adjusted the price target to $48. Additionally, RBC Capital Markets raised its price target to $65, TD Cowen to $65, and JPMorgan to $59. These adjustments reflect Varonis' strong performance and successful transition towards a SaaS business model.
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