Stifel analyst Tom Roderick maintains a Buy rating on Veeva with a price target lifted from $175 to $185.
SunTrust Robinson Humphrey analyst Sandy Draper maintains at Buy, price target lifted from $150 to $180.
Stifel: Blowing Through Milestone
Veeva's "clean" quarter is highlighted by a 27% year-over-year growth in revenue, 28% growth in subscription revenue, 24% growth in professional services revenue, and 29% growth in calculated bookings, Roderick said. The quarter also marks a milestone as the company "blows through" a $1 billion revenue run rate.
Roderick said Veeva's report shows it has multiple initiatives and growth drivers in place to sustain current momentum, including the core Commercial Cloud business Vault. The company also won market share at small- and medium-sized pharmaceutical companies while add-on solutions like Engage doubled in adoption.
"We believe Veeva is well positioned to deliver solid growth at scale," the analyst wrote in a note. "Combined with a best in class margin profile, we see Veeva as one of the most compelling long-term stories in our space."
SunTrust: Bull Stance Validated
Veeva's strong quarter solidifies the case for being on the stock for three reasons, Draper said.
First, the growth seen in Vault and contracts won makes it clear it will be a "market share taker." Second, newer products and greater adoption of the commercial suite contributed to an acceleration in overall Commercial revenue growth. Finally, recent momentum in ex-Life sciences solutions represents a future benefit that isn't factored in to current estimates.
The revised $180 price target is based on 57 times EV/FCF on 2021 estimates. The multiple represents a premium to the two-year and five-year average of 46 times but justified given a track record of beat and raises reports.
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