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Veeva (VEEV) Down 0.8% Since Last Earnings Report: Can It Rebound?

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It has been about a month since the last earnings report for Veeva Systems (VEEV - Free Report) . Shares have lost about 0.8% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Veeva due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Veeva Systems Q4 Earnings and Revenues Beat Estimates

Veeva Systems, Inc. reported fourth-quarter fiscal 2021 adjusted earnings per share of 78 cents, beating the Zacks Consensus Estimate of 68 cents by 14.7%.  Moreover, the metric surged 44.4% on a year-over-year basis.

For fiscal 2021, adjusted EPS came in at $2.94, beating the Zacks Consensus Estimate by 3.5%. Also, the bottom line grew 34.2% year over year.

Revenues

For the quarter, the company’s revenues totaled $396.8 million, outpacing the Zacks Consensus Estimate by 4.4%. On a year-over-year basis, the top line improved 27.4%.

For fiscal 2021, revenues summed $1.47 billion, beating the Zacks Consensus Estimate by 1.4%. The top line also surged 33.6% year over year.

Segmental Details

Subscription Service

Fiscal fourth-quarter subscription service revenues totaled $322.8 million, up 27% year over year.

Professional Service and Others

Professional Service revenues rose 28.7% to $73.9 million from the year-ago figure.

Per management, solid performances by Veeva Commercial Cloud and Veeva Vault drove revenues across all segments.

Margin Details

In the reported quarter, gross profit increased 30.3% year over year to $282.9 million. Gross margin was 71.3%, which expanded 158 basis points (bps).

Total operating cost came in at $184.1 million, up 17.4%.

Operating profit totaled $98.8 million, up 63.7% year over year. In the quarter under review, operating margin rose 553 bps to 24.9%.

Cash Position

The company exited the fiscal fourth quarter with cash and cash equivalents of $730.5 million compared with $476.7 million at the end of the year-ago period.

Cumulative net cash provided by operating activities came in at $551.2 million, up from $437.4 million at the end of the year-ago period.

Guidance

For the first quarter of fiscal 2022, Veeva Systems expects revenues between $408 million and $410 million. The Zacks Consensus Estimate for the same stands at $400.4 million.

Adjusted EPS is projected between 77 and 78 cents. The Zacks Consensus Estimate for the metric is pegged at 74 cents.

Adjusted operating income is estimated between $157 million and $159 million.

For fiscal 2022, revenues are expected within $1.76 and $1.77 billion (up from the previously issued guided range of $1.70-$1.72 billion). The Zacks Consensus Estimate for the same is pegged at $1.72 billion.

Adjusted EPS is expected to be $3.20. The Zacks Consensus Estimate for the same stands at $3.11.

Adjusted operating income is anticipated to be around $655 million.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates review. The consensus estimate has shifted 9.31% due to these changes.

VGM Scores

Currently, Veeva has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Veeva has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.


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