Veeva Systems Inc (NYSE: VEEV)

Sector: Healthcare Industry: Health Information Services CIK: 0001393052
Market Cap 37.30 Bn
P/B 5.30
P/E 43.36
P/S 12.11
ROIC (Qtr) 9.36
Div Yield % 0.00
Rev 1y % (Qtr) 16.02
Total Debt (Qtr) 89.80 Mn
Debt/Equity (Qtr) 0.01

About

Veeva Systems Inc., often recognized by its stock symbol VEEV, operates in the life sciences industry, offering cloud-based software, data, and business consulting services. The company is renowned for its industry cloud solutions, which cater to pharmaceutical, biotechnology, and medical device companies. Veeva's operations span various countries and regions, providing solutions designed to streamline clinical, regulatory, quality, safety, sales, marketing, and medical affairs functions. Veeva generates revenue through its comprehensive suite...

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Price action

Investment thesis

Bull case

  • Strong operating cash flow of 1.38B provides robust 15.35x coverage of total debt 89.80M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 1.66B provide 157.67x coverage of short-term debt 10.53M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 7.62B provides 84.91x coverage of total debt 89.80M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 1.35B exceeds capital expenditure of 26.82M by 50.37x, indicating strong organic growth funding capability.
  • Strong operating cash flow of 1.38B provides 1.91x coverage of SG&A expenses 721.68M, showing efficient operational cost management.

Bear case

  • Operating cash flow of 1.38B barely covers its investment activities of (952.30M), with a coverage ratio of -1.45, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (952.30M) provide weak support for R&D spending of 750.12M, which is -1.27x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of 1.38B shows concerning coverage of stock compensation expenses of 469.65M, with a 2.93 ratio indicating potential earnings quality issues.
  • Short-term investments of 4.98B represent 0.81x of working capital 6.17B, suggesting potentially excessive financial asset allocation versus operational needs.
  • Short-term investments of 4.98B exceed receivables of 371.78M by 13.39x, indicating potentially inefficient capital allocation given collection cycle needs.

Peer comparison

Companies in the Health Information Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 TEM Tempus AI, Inc. 45.63 Bn -223.83 41.29 1.34 Bn
2 GEHC GE HealthCare Technologies Inc. 38.75 Bn 19.85 2.19 10.28 Bn
3 VEEV Veeva Systems Inc 37.30 Bn 43.36 12.11 0.09 Bn
4 DOCS Doximity, Inc. 7.81 Bn 30.87 12.57 0.01 Bn
5 BTSG BrightSpring Health Services, Inc. 7.70 Bn 59.42 0.62 2.70 Bn
6 HQY Healthequity, Inc. 7.32 Bn 38.14 5.67 1.03 Bn
7 WAY Waystar Holding Corp. 5.00 Bn 44.97 4.81 1.25 Bn
8 PRVA Privia Health Group, Inc. 2.79 Bn 153.67 1.37 0.01 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 4.38 2.77
EV to Cash from Ops. EV/CFO 25.73 -10.86
EV to Debt EV to Debt 394.85 161.93
EV to EBIT EV/EBIT 31.60 -106.48
EV to EBITDA EV/EBITDA 38.92 4.22
EV to Free Cash Flow [EV/FCF] EV/FCF 26.24 7.46
EV to Market Cap EV to Market Cap 0.95 -14.93
EV to Revenue EV/Rev 11.51 1.76
Price to Book Value [P/B] P/B 5.30 10.57
Price to Earnings [P/E] P/E 43.36 147.14
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 -8.65
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 5.00
Dividend per Basic Share Div per Share (Qtr) 0.00 0.04
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 4.57
Interest Coverage Interest Coverage 0.00 -584.72
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -13.97 -24.09
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 58.94 172.48
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -1.05
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 29.20 -17.73
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 32.52 39.85
EBIT Growth (1y) % EBIT 1y % (Qtr) 30.94 -38.83
EBT Growth (1y) % EBT 1y % (Qtr) 30.94 -4.52
EPS Growth (1y) % EPS 1y % (Qtr) 27.91 2.60
FCF Growth (1y) % FCF 1y % (Qtr) 28.10 -48.57
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 18.69 5.49
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.38 0.66
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.03
Cash Ratio Cash Ratio (Qtr) 1.76 1.87
Current Ratio Curr Ratio (Qtr) 7.53 3.27
Debt to Equity Ratio Debt/Equity (Qtr) 0.01 -0.43
Interest Cover Ratio Interest Cover Ratio 0.00 -584.72
Times Interest Earned Times Interest Earned 0.00 -584.72
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 38.10 -435.80
EBIT Margin % EBIT Margin % (Qtr) 36.43 -464.70
EBT Margin % EBT Margin % (Qtr) 36.43 -461.74
Gross Margin % Gross Margin % (Qtr) 75.70 44.03
Net Profit Margin % Net Margin % (Qtr) 27.90 -468.01