DA Davidson Forecast 15%-20% ARR Growth For Varonis Systems, Inc. (VRNS) with Margin Rebound by 2027

We recently compiled a list of the 15 Best Strong Buy Tech Stocks to Invest In. The next stock on our list of best tech stocks is Varonis Systems, Inc.

TheFly reported on February 5 that DA Davidson analyst Rudy Kessinger upgraded VRNS from Neutral to Buy and raised the price target to $30 from $25. The firm highlighted the company’s strong software-as-a-service annual recurring revenue growth, excluding conversions, and noted that guidance of 18%-20% leaves room for upside. DA Davidson expects VRNS to achieve 15%-20% ARR growth with a margin rebound in 2027.

A day earlier, on February 4, Truist lowered its price target on Varonis Systems, Inc. (NASDAQ:VRNS) to $34 from $42 while maintaining a Buy rating. The shares fell as the outlook indicated a lower-than-expected overall ARR because of the phase-out of OPS customers, despite the company’s impressive Q4 results that were above expectations and were bolstered by ongoing SaaS momentum and a record number of client conversions.

Additionally, on February 3, VRNS  announced that it is acquiring AllTrue.ai, a company focused on AI trust, risk, and security management, to enhance oversight and protection of AI systems. Through the addition of real-time visibility and control over how AI technologies function and access data, the agreement aims to fortify VRNS’ Data Security Platform. There was no disclosure of the financial terms. In order to properly manage risk while implementing AI solutions, CEO Yaki Faitelson emphasized that because AI technologies might behave in unforeseen ways, it is critical for enterprises to comprehend which AI systems are in use, how they operate, and what data they can access.

Varonis Systems, Inc. (NASDAQ:VRNS) is a U.S. cybersecurity software company that provides AI-powered data security and analytics solutions to detect threats, protect sensitive data, and automate risk remediation across cloud, SaaS, hybrid, and on-premises environments.

While we acknowledge the potential of VRNS as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.