Veeva Systems Inc. (VEEV) is the leading cloud software provider to the life sciences industry. Last week’s huge-volume earnings move looks like a change in character. We’re okay entering here with a stop under $250, says Mike Cintolo, editor of Cabot Top Ten Trader.
VEEV has a solution built from the ground-up many years ago to handle the intricacies of the life sciences business. It starts with sales and marketing functions and expands to everything from clinical trial management to tracking and reporting, regulatory submissions, safety and quality control aids, and medical content creation.
Veeva is a larger firm these days. It just crossed $3 billion of annualized run-rate revenue. So, growth isn’t going to be off the charts. But the firm continues to execute and the top brass recently set a $6 billion run-rate goal by 2030, expecting continued mid-teens growth for many years to come.
Q1 results were terrific, with total revenue rising 17% (subscription revenue, which makes up more than 80% of the total, was up 19%). Operating income lifted 34% (margin of 46%!) and earnings of $1.97 per share rose 31% and crushed estimates.
VEEV shares fell hard in 2022 and really never regained their shine, with slightly higher lows over time but no powerful, sustained advances. The last time it nosed to new high ground last December was immediately met with selling – with a failed breakout leading to many more months of grinding sideways action.
But VEEV didn’t fall apart during the market correction, holding the $200 level and the 200-day line. Then after a decent recovery, it experienced the recent powerful move.
