Shares of Veeva Systems (VEEV, Financial) surged 9.18% today, reaching a price of $217.66, fueled by an impressive earnings report and optimistic guidance for the upcoming quarter.
Veeva Systems reported a 15% increase in quarterly revenue, with subscription revenue—comprising 83% of total revenue—growing by 19%. The company's adjusted (non-GAAP) earnings per share rose by 33% to $1.62, highlighting strong operational leverage.
For Q3, Veeva Systems provided revenue guidance in the range of $682 million to $685 million and adjusted EPS between $1.57 and $1.58. While the top-line guidance slightly missed the consensus estimate of $685.9 million, the bottom-line guidance exceeded the forecast of $1.55. CEO Peter Gassner mentioned significant strategic wins during the quarter, which are expected to drive future growth. He emphasized that the company is "winning virtually every CRM deal," showcasing its robust market position.
Looking at the stock from a valuation standpoint, Veeva Systems is currently trading with a price-to-earnings (P/E) ratio of 64.21 and a price-to-book (P/B) ratio of 7.2. According to GuruFocus, Veeva Systems has a GF Value of $236.71, which suggests that the stock is fairly valued.
Veeva's financial metrics show strong financial health, including a high Altman Z-Score of 17.17 and a comfortable interest coverage ratio, indicating the company's stability. However, potential investors should be aware of the medium warning sign regarding insider selling, which showed 2 transactions and a total of 17,353 shares sold over the past three months.
Overall, Veeva Systems demonstrates consistent revenue and earnings growth, as evidenced by its predictable growth rates and strong financial strength. The company's strong balance sheet and high profitability make it an attractive investment in the healthcare sector, specifically within the health information services sub-industry.
