VARONIS SYSTEMS INC (VRNS)
US9222801022 - Common Stock
We assign a fundamental rating of 4 out of 10 to VRNS. VRNS was compared to 277 industry peers in the Software industry. The financial health of VRNS is average, but there are quite some concerns on its profitability. VRNS shows excellent growth, but is valued quite expensive already.
1. Profitability
1.1 Basic Checks
VRNS had positive earnings in the past year.
In the past year VRNS had a positive cash flow from operations.
VRNS had negative earnings in each of the past 5 years.
In multiple years VRNS reported negative operating cash flow during the last 5 years.
1.2 Ratios
With a Return On Assets value of -9.78%, VRNS perfoms like the industry average, outperforming 47.46% of the companies in the same industry.
VRNS has a Return On Equity of -22.79%. This is comparable to the rest of the industry: VRNS outperforms 48.19% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -9.78% | ||
| ROE | -22.79% | ||
| ROIC | N/A |
ROA(3y)-10.54%
ROA(5y)-14.66%
ROE(3y)-21.67%
ROE(5y)-49.83%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
The Gross Margin of VRNS (85.07%) is better than 93.12% of its industry peers.
VRNS's Gross Margin has been stable in the last couple of years.
VRNS does not have Profit Margin and Operating Margin available, so we won't be analyzing them here.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 85.07% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.3%
GM growth 5Y-0.94%
2. Health
2.1 Basic Checks
VRNS does not have a ROIC to compare to the WACC, probably because it is not profitable.
Compared to 1 year ago, VRNS has more shares outstanding
The number of shares outstanding for VRNS has been increased compared to 5 years ago.
The debt/assets ratio for VRNS has been reduced compared to a year ago.
2.2 Solvency
VRNS has an Altman-Z score of 4.62. This indicates that VRNS is financially healthy and has little risk of bankruptcy at the moment.
VRNS has a Altman-Z score of 4.62. This is in the better half of the industry: VRNS outperforms 67.75% of its industry peers.
The Debt to FCF ratio of VRNS is 3.34, which is a good value as it means it would take VRNS, 3.34 years of fcf income to pay off all of its debts.
VRNS's Debt to FCF ratio of 3.34 is fine compared to the rest of the industry. VRNS outperforms 65.22% of its industry peers.
A Debt/Equity ratio of 0.55 indicates that VRNS is somewhat dependend on debt financing.
VRNS has a Debt to Equity ratio of 0.55. This is in the lower half of the industry: VRNS underperforms 63.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.55 | ||
| Debt/FCF | 3.34 | ||
| Altman-Z | 4.62 |
ROIC/WACCN/A
WACC9.6%
2.3 Liquidity
VRNS has a Current Ratio of 2.38. This indicates that VRNS is financially healthy and has no problem in meeting its short term obligations.
VRNS's Current ratio of 2.38 is fine compared to the rest of the industry. VRNS outperforms 68.12% of its industry peers.
A Quick Ratio of 2.38 indicates that VRNS has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 2.38, VRNS is in the better half of the industry, outperforming 69.20% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.38 | ||
| Quick Ratio | 2.38 |
3. Growth
3.1 Past
VRNS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 26.92%, which is quite impressive.
VRNS shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 30.08% yearly.
Looking at the last year, VRNS shows a small growth in Revenue. The Revenue has grown by 4.38% in the last year.
VRNS shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 13.05% yearly.
EPS 1Y (TTM)26.92%
EPS 3YN/A
EPS 5Y30.08%
EPS growth Q2Q-5.18%
Revenue 1Y (TTM)4.38%
Revenue growth 3Y19.47%
Revenue growth 5Y13.05%
Revenue growth Q2Q6.26%
3.2 Future
Based on estimates for the next years, VRNS will show a very strong growth in Earnings Per Share. The EPS will grow by 35.80% on average per year.
The Revenue is expected to grow by 12.62% on average over the next years. This is quite good.
EPS Next Y-57.9%
EPS Next 2Y-19.78%
EPS Next 3Y9.74%
EPS Next 5Y35.8%
Revenue Next Year9.14%
Revenue Next 2Y10.68%
Revenue Next 3Y12.2%
Revenue Next 5Y12.62%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 131.79, VRNS can be considered very expensive at the moment.
VRNS's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 28.83. VRNS is valued rather expensively when compared to this.
VRNS is valuated quite expensively with a Price/Forward Earnings ratio of 187.71.
VRNS's Price/Forward Earnings is on the same level as the industry average.
VRNS is valuated expensively when we compare the Price/Forward Earnings ratio to 20.47, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 131.79 | ||
| Fwd PE | 187.71 |
4.2 Price Multiples
Compared to the rest of the industry, the Price/Free Cash Flow ratio of VRNS is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 64.69 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)4.38
EPS Next 2Y-19.78%
EPS Next 3Y9.74%
5. Dividend
5.1 Amount
VRNS does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
VARONIS SYSTEMS INC
NASDAQ:VRNS (5/16/2024, 7:24:34 PM)
After market: 43.49 0 (0%)43.49
-1.08 (-2.42%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap4.85B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
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Surprises & Revisions
EPS beat(2)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 131.79 | ||
| Fwd PE | 187.71 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)4.38
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -9.78% | ||
| ROE | -22.79% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 85.07% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.55 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 2.38 | ||
| Quick Ratio | 2.38 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)26.92%
EPS 3YN/A
EPS 5Y
EPS growth Q2Q
EPS Next Y-57.9%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)4.38%
Revenue growth 3Y19.47%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
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