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Tuesday, Raymond (NSE:RYMD) James analyst Brian Peterson reiterated an Outperform rating on Veeva Systems (NYSE:VEEV) with a stable $285.00 price target. According to InvestingPro data, the company maintains a "GREAT" financial health score, with 19 analysts recently revising their earnings expectations upward. The stock is currently trading near its Fair Value, suggesting balanced market pricing. Peterson highlighted key insights from Veeva’s recent 10-K filing, particularly noting the consistent revenue contribution from the company’s top 10 customers, which remained at 28%. This stability is seen as a positive sign of Veeva’s ongoing deals with its largest clients. The company’s strong performance is reflected in its impressive 74.5% gross profit margin and 16.2% revenue growth over the last twelve months.
Veeva Systems, which offers cloud-based software for the global life sciences industry, has been working on expanding its reach among smaller customers. However, the steady revenue from top customers suggests that Veeva is also making significant inroads with larger organizations. Peterson pointed out that these major clients are increasingly seeking to work more strategically with Veeva, as evidenced by a strong 17% billings growth in the fourth fiscal quarter.
The Americas region finished the fiscal year 2025 with the highest growth rate at 18%, outpacing the single-digit growth rates seen in Latin America and the rest of the world (ROW). This regional performance underscores Veeva’s robust market position in the Americas.
Furthermore, the analyst observed a deceleration in the accrued fees payable to Salesforce (NYSE:CRM), which decreased by 2% year-over-year. This trend is thought to reflect the initial stages of customer migration from the Salesforce-powered Veeva CRM to Veeva’s own Vault CRM. According to Peterson, this metric not only tracks the growth in Veeva CRM seats but now also serves as an indicator of the potential shift to Vault CRM. The current data implies that 95% of peak seats are still utilizing the Salesforce platform.
Veeva’s financial and operational metrics, as outlined in the 10-K filing, offer investors a detailed look at the company’s performance and strategic direction, with the analyst’s commentary shedding light on the potential for continued growth and customer engagement. The company maintains a robust balance sheet with a current ratio of 4.51 and more cash than debt. For deeper insights into Veeva’s financial health and growth prospects, InvestingPro subscribers can access 12 additional ProTips and a comprehensive Pro Research Report, part of the platform’s coverage of 1,400+ top US stocks.
In other recent news, Veeva Systems reported a strong fourth-quarter performance, with normalized billings exceeding forecasts by 5 percentage points and subscription and operational margins outperforming by approximately 3 points. The company saw a 14% year-over-year revenue increase, positively impacting margins and earnings, which rose by 26% compared to the previous year. Citi analyst Tyler Radke reaffirmed a Buy rating with a $307 price target, while Stifel maintained a Buy rating with a $272 target, both highlighting the company’s impressive earnings and outlook for fiscal year 2026. TD Cowen’s analyst Charles Rhyee raised the price target to $261, citing strong research and development growth and robust adjusted operating income margins. RBC Capital Markets also maintained an Outperform rating with a $285 price target, noting Veeva’s strong execution in subscription growth and billing alignment with consensus expectations. Despite concerns about potential risks from customer decisions and market perceptions of high margins, analysts remain optimistic about Veeva’s growth trajectory. The company’s guidance for FY26 indicates an 11% revenue and EPS growth, surpassing expectations and demonstrating robust product adoption in commercial and research sectors. These developments reflect a positive outlook for Veeva Systems, supported by strong financial performance and strategic initiatives.
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