William Blair analyst Jason Ader has maintained their bullish stance on VRNS stock, giving a Buy rating on September 3.
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Jason Ader has given his Buy rating due to a combination of factors surrounding Varonis Systems’ recent strategic moves. The acquisition of SlashNext, an AI-native email security provider, is a significant step in enhancing Varonis’s security platform. This acquisition is expected to broaden the platform’s coverage by integrating email security, which is increasingly crucial given the rise in email phishing attacks. The integration is anticipated to create new upsell and monetization opportunities, adding strategic value to Varonis’s offerings.
Despite the acquisition’s near-term impact on operating margins and EPS estimates, Ader sees potential upside in the long term. The adjustments in financial models reflect the added R&D expenses, but the potential for revenue growth remains, especially as the email security component is integrated and sold as an add-on. Ader’s confidence in the acquisition’s strategic fit and the potential for enhanced platform capabilities underpins his Buy rating for Varonis Systems.
In another report released on September 3, Needham also maintained a Buy rating on the stock with a $70.00 price target.