It's been a sad week for Varonis Systems, Inc. (NASDAQ:VRNS), who've watched their investment drop 13% to US$39.93 in the week since the company reported its second-quarter result. It was a pretty bad result overall; while revenues were in line with expectations at US$180m, statutory losses exploded to US$0.41 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Varonis Systems after the latest results.

Taking into account the latest results, the current consensus from Varonis Systems' 23 analysts is for revenues of US$737.8m in 2026. This would reflect a reasonable 7.2% increase on its revenue over the past 12 months. Per-share losses are predicted to creep up to US$1.28. Before this latest report, the consensus had been expecting revenues of US$734.7m and US$1.15 per share in losses. So it's pretty clear the analysts have mixed opinions on Varonis Systems even after this update; although they reconfirmed their revenue numbers, it came at the cost of a considerable increase in per-share losses.

Although the analysts are now forecasting higher losses, the average price target rose 11% to 45.54545, which could indicate that these losses are expected to be "one-off", or are not anticipated to have a longer-term impact on the business. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Varonis Systems analyst has a price target of US$60.00 per share, while the most pessimistic values it at US$28.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's clear from the latest estimates that Varonis Systems' rate of growth is expected to accelerate meaningfully, with the forecast 15% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 12% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 16% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Varonis Systems is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Varonis Systems analysts - going out to 2028, and you can see them free on our platform here.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.