Let’s talk about the popular Veeva Systems Inc. (NYSE: VEEV). Shares of the company have seen significant price moves in recent months on the NYSE, reaching highs of US$192 and falling to lows of US$151. Certain movements in the stock price can give investors a better opportunity to get into the stock and potentially buy at a lower price. One question to answer is does Veeva Systems’ current price of $160 reflect the true value of the large cap? Or is it currently undervalued, giving us the opportunity to buy? Let’s take a look at the outlook and value of Veeva Systems based on the most recent financial data to see if there are any catalysts for a price change.
Check out our latest analysis for Veeva Systems
What is Veeva Systems worth?
According to my valuation model, Veeva Systems appears to have a fair price of about 13% below my intrinsic value, which means that if you buy Veeva Systems today, you will pay a fair price for it. And if you think the true value of the company is $183.07, then there’s not much room for the stock price to rise beyond what it’s currently trading. Additionally, Veeva Systems’ low beta means the stock is less volatile than the broader market.
What does the future of Veeva Systems look like?
Future prospects are an important aspect when considering buying a stock, especially if you are an investor looking to grow your portfolio. Although value investors argue that it is intrinsic value relative to price that matters most, a more compelling investment thesis would be high growth potential at a cheap price. Veeva Systems’ earnings over the next few years are expected to increase by 62%, indicating a very optimistic future. This should lead to more robust cash flow, fueling higher share value.
What this means for you
Are you a shareholder? It looks like the market has already priced in the positive outlook for VEEV, with the stock trading around its fair value. However, there are also other important factors that we haven’t considered today, such as the background of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy if the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping an eye on VEEV, now might not be the most optimal time to buy, given that it’s trading around its fair value. However, the optimistic outlook is encouraging for the company, which means that it is worth looking further into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
So, if you want to dig deeper into this stock, it is crucial to consider the risks it faces. In terms of investment risks, we have identified 1 warning sign with Veeva Systems, and understanding it should be part of your investment process.
If you are no longer interested in Veeva Systems, you can use our free platform to view our list of over 50 other stocks with high growth potential.
What are the risks and opportunities for Veeva Systems?
Trades 12.8% below our estimate of its fair value
Revenues are expected to increase by 17.41% per year
Significant insider selling in the last 3 months
See all risks and rewards
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.