Veeva Systems (VEEV) PT Lowered to $185 at Evercore ISI

Evercore ISI analyst Kirk Materne lowered the price target on Veeva Systems (NYSE: VEEV) to $185.00 (from $195.00) while maintaining a Outperform rating.

The analyst comments "Bottom line: Veeva delivered a strong F1Q, with total revenue of $882.9mn (+16% y/y), ahead of mgmt. guidance of $855–$858mn (+12.8% y/y) and Street estimates of ~$857.7mn (+13% y/y), driven by broad-based revenue outperformance across both R&D/Quality and Commercial. Subscription revenue was $730mn (+15% y/y), while services revenue of $153mn (+23% y/y) also contributed to the beat, reflecting strong project execution in R&D and business consulting. That said, we believe the after-hours pullback reflects three key factors: one, the FY27 raise was largely driven by services and inorganic contribution, with ~$35mn of the $45mn high-end increase attributable to services and Ostro, leaving only ~$10mn of ex-Ostro subscription upside; two, the guide implies 2H moderation in subscription growth as newer products such as EDC, ECOA, and RTSM need more time to scale, while more mature products such as ETMF are already highly penetrated; and three, limited prepared-remarks commentary on the remaining Vault CRM decisions likely left some investors wanting a more definitive update, even as management remains confident in its ability to win the majority of the four remaining top-20 decisions. We are adjusting our PT to $185 or 14x EV/CY27 FCF to account for changes in software valuations."

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