Microvast Holdings announces departure of chief financial officer
Thursday, May 15, 2025 - Endava PLC (NYSE:DAVA) saw its price target reduced by Needham from $22.00 to $18.00, although the firm maintained a Buy rating on the company’s shares. The adjustment followed Endava’s third-quarter fiscal year 2025 earnings, which did not meet revenue expectations due to a decline in client demand. Despite this, a decrease in expenses aided in improving profit margins and earnings per share (EPS). According to InvestingPro data, the company maintains healthy financials with a current ratio of 2.18, indicating strong liquidity to meet short-term obligations.
The company’s management provided a subdued outlook for the fourth quarter and revised the full-year 2025 guidance downward to account for cautious client spending and foreign exchange headwinds. InvestingPro data reveals that 4 analysts have revised their earnings downward for the upcoming period. The stock has experienced significant pressure, falling over 41% in the past six months, with Needham’s analyst noting that after a 27% drop following the earnings release, the potential for further downside seemed limited. For deeper insights into Endava’s financial health and future prospects, investors can access comprehensive Pro Research Reports available on InvestingPro, covering over 1,400 US equities.
The analyst at Needham remains optimistic about the future, citing the anticipated benefits of artificial intelligence (AI) adoption in the second half of the calendar year 2025 and into 2026. Additionally, the potential for an increase in demand for digital transformation services as the year progresses was highlighted as a reason for maintaining the Buy rating.
Endava’s stock is currently trading at around ten times Needham’s forecast for the company’s fiscal year 2026 EPS. Based on these valuations and the expected developments in AI and client demand, Needham believes that the risk-reward profile is favorable for small to mid-cap (SMID) value investors looking at Endava’s shares. Despite the lowered price target, the firm’s outlook for Endava remains positive as the market heads towards the latter half of the year.
In other recent news, Endava PLC reported a mixed performance for its second quarter of fiscal year 2025, with a decline in revenue due to a 9% drop in the Technology, Media, and Telecommunications vertical. Despite this, the company exceeded expectations in profit before tax margins and earnings per share, thanks to effective cost management. Needham analysts responded by lowering the price target from $43.00 to $38.00 but retained a Buy rating on the stock, citing its attractive fiscal year 2026 price-to-earnings multiple. In contrast, TD Cowen downgraded Endava from Buy to Hold, reducing the price target to $17.00 due to a challenging outlook for revenue growth and earnings expansion.
BofA Securities maintained a Neutral rating with a $20.00 price target, highlighting Endava’s difficulties in converting its business pipeline into sales, particularly in North America. The company has increased its share repurchase authorization by $50 million, bringing the total to approximately $110 million, as a measure against further downside risk. On the strategic front, Endava announced a partnership with AlixPartners to deliver comprehensive digital solutions, aiming to accelerate digital transformation across various sectors. Additionally, Endava joined OpenAI’s Beta Services Partner Program to enhance its position in the enterprise AI market, building on a year-long collaboration to develop innovative AI solutions for clients.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.