For those who appreciate growth without the sticker shock, NYSE:VEEV is worth considering.

Last update: Dec 5, 2023

Discover VEEVA SYSTEMS INC-CLASS A (NYSE:VEEV), an undervalued growth gem identified by our stock screener. NYSE:VEEV is shining in terms of growth metrics, and it's also displaying strong financial health and profitability. What's more, it retains an appealing valuation. We'll break it down further.

Deciphering NYSE:VEEV's Growth Rating

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NYSE:VEEV boasts a 8 out of 10:

VEEV shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.11%, which is quite good.
The Earnings Per Share has been growing by 35.83% on average over the past years. This is a very strong growth
Looking at the last year, VEEV shows a quite strong growth in Revenue. The Revenue has grown by 11.56% in the last year.
VEEV shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 25.56% yearly.
VEEV is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 13.33% yearly.
The Revenue is expected to grow by 12.76% on average over the next years. This is quite good.

Exploring NYSE:VEEV's Valuation

ChartMill assigns a Valuation Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing different valuation elements, such as price to earnings and free cash flow, both in absolute terms and relative to the market and industry. In the case of NYSE:VEEV, the assigned 5 reflects its valuation:

Compared to the rest of the industry, the Price/Earnings ratio of VEEV indicates a rather cheap valuation: VEEV is cheaper than 83.33% of the companies listed in the same industry.
Based on the Price/Forward Earnings ratio, VEEV is valued cheaply inside the industry as 85.71% of the companies are valued more expensively.
Based on the Enterprise Value to EBITDA ratio, VEEV is valued a bit cheaper than 66.67% of the companies in the same industry.
VEEV's Price/Free Cash Flow ratio is rather cheap when compared to the industry. VEEV is cheaper than 80.95% of the companies in the same industry.
VEEV has an outstanding profitability rating, which may justify a higher PE ratio.
VEEV's earnings are expected to grow with 14.19% in the coming years. This may justify a more expensive valuation.

Unpacking NYSE:VEEV's Health Rating

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:VEEV has received a 8 out of 10:

An Altman-Z score of 18.15 indicates that VEEV is not in any danger for bankruptcy at the moment.
VEEV has a Altman-Z score of 18.15. This is amongst the best in the industry. VEEV outperforms 95.24% of its industry peers.
VEEV has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
VEEV has a Current Ratio of 4.35. This indicates that VEEV is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 4.35, VEEV is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
A Quick Ratio of 4.35 indicates that VEEV has no problem at all paying its short term obligations.
VEEV's Quick ratio of 4.35 is fine compared to the rest of the industry. VEEV outperforms 71.43% of its industry peers.

Profitability Examination for NYSE:VEEV

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:VEEV was assigned a score of 9 for profitability:

VEEV has a Return On Assets of 10.33%. This is amongst the best in the industry. VEEV outperforms 95.24% of its industry peers.
The Return On Equity of VEEV (13.01%) is better than 95.24% of its industry peers.
VEEV has a better Return On Invested Capital (8.39%) than 97.62% of its industry peers.
The Average Return On Invested Capital over the past 3 years for VEEV is significantly above the industry average of 4.22%.
The last Return On Invested Capital (8.39%) for VEEV is well below the 3 year average (13.53%), which needs to be investigated, but indicates that VEEV had better years and this may not be a problem.
VEEV has a better Profit Margin (24.19%) than 95.24% of its industry peers.
With an excellent Operating Margin value of 17.73%, VEEV belongs to the best of the industry, outperforming 95.24% of the companies in the same industry.
With a decent Gross Margin value of 70.71%, VEEV is doing good in the industry, outperforming 71.43% of the companies in the same industry.

Every day, new Affordable Growth stocks can be found on ChartMill in our Affordable Growth screener.

For an up to date full fundamental analysis you can check the fundamental report of VEEV

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.