VRNS Reportedly Exploring Sale Following Private Equity Interest

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VRNS Reportedly Exploring Sale Following Private Equity Interest

H O T C O M M E N T

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Varonis Systems, Inc. (VRNS) Overweight

CONCLUSION PRICE: US$32.71

Earlier today, Bloomberg reported that VRNS is exploring a potential sale after receiving TARGET: US$47.00

interest from multiple private equity firms, according to people who are familiar with Our base case discounted cash flow assumes

the matter. Given VRNS's data security solution set plays an important role in helping a terminal multiple of 20x CY30E EV/FCF, a

organizations secure AI usage and the SaaS transition has helped drive better customer discount rate of 18%, and 126M fully diluted

acquisition and expansion dynamics, we are relatively unsurprised to hear that the company shares outstanding.

is a potential acquisition target - especially with shares trading at ~4.8x our CY'27E revenue

Rob D. Owensestimate. As the article noted that talks are in early stages, we expect an announcement Sr. Research Analyst, Piper Sandler & Co.

(if any) will likely take time to materialize. 503 275-8317, rob.owens@psc.com

Ethan D. Weeks, CFA

Our Overweight rating is predicated on the combination of a de-risked setup (with the SaaS Research Analyst, Piper Sandler & Co.

transition) and underlying market momentum as customers continue to move forward with 503 275-7797, ethan.weeks@psc.com

data protection projects tied to AI. Further, we continue to see VRNS as a compelling M&A Aidan M. Perry

candidate as the space continues to consolidate and due to the company having some Research Analyst, Piper Sandler & Co.

503 275-8309, aidan.perry@psc.com

unique, best in class assets for protecting unstructured data stores. We reiterate our OW

rating / $47 PT. RISKS TO ACHIEVEMENT OF