Forensic Analysis · Technology / Software · as of Aug 11, 2026
Varonis Systems Inc (VRNS)
A forensic read on Varonis Systems Inc built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
D · Weak — demands caution
Forensic grade
Safe
Financial health
4.6
Distress distance
Clean
Earnings quality
3
Forensic signals
-35.1
P / E (ttm)
-21.6%
ROE
$5.0B
Market cap
0.00%
Dividend yield
13.2%
Revenue growth
This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (red flags, auditor quality, say on pay, board independence). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.
Varonis Systems Inc earns a D (Weak — demands caution) forensic quality grade, and its balance-sheet distress test reads 4.6, placing it in the Safe zone. 3 forensic signals were flagged in its latest SEC filings, led by accruals ratio (% of noa).
What the filings flag
+37.9%
FY2024→FY2025
Accruals ratio (% of NOA).Net operating assets grew +37.9% relative to their own average in FY2025 — scaled by NOA itself, not total assets (see the Forensic Screens card's differently-scaled Sloan Accrual Ratio for that read). Accruals are building sharply — a large slice of profit sits in operating assets, not cash; Richardson/Sloan link high accruals to weaker future returns as they reverse. The build is led by receivables up +26% against revenue +13%. The cash-flow cross-check is more mixed: reported earnings ran behind operating cash by 83% of net operating assets, diverging from the balance-sheet accrual read.
-12.4%
FY2025
Return on invested capital.Return on invested capital is -12.4% in the latest fiscal year and rising from -21% — well below its ~10% cost of capital, so reinvested dollars may be destroying value, not building it.
+1.5%/yr
FY2022–FY2025
Share-count dilution.Diluted share count changed +5% over the last 3 years to FY2025 (+1.5%/yr). The count is growing: more stock was issued than repurchased over this window, so aggregate results grew faster than their per-share equivalents. That's ~1.5% shaved off per-share growth every year — total profit has to grow that much just to keep earnings-per-share flat, and a stake held since FY2022 has been diluted ~4%.
Key fundamentals
Latest Revenue$623.5M
Revenue Growth YoY+13.2%
Revenue CAGR (3yr)+9.6%
Net Margin-20.7%
Free Cash Flow$134.8M
Return on Equity-21.6%
The forensic grade and screens above are free — no account needed. Want the AI investment read on top — the 0–100 rating, thesis, bull-vs-bear, red flags and the 12-month scenario, written from Varonis Systems Inc's actual 10-K/10-Q/8-K filings?