Veeva Systems Inc Class A (VEEV)

Conclusion

Veeva Systems sells cloud software to the life sciences industry, covering customer relationship management, clinical trial, regulatory, quality and content systems for pharmaceutical and biotechnology companies. At 306.40 USD on 9 November 2026, the company has a market capitalisation of 49.61 billion USD and an enterprise value of 42.52 billion USD.

The verdict is fair. The fair value band runs from 298.12 to 447.18 USD with a midpoint of 372.65 USD, giving a margin of safety of 21.6% at the current price. Today's multiples sit well below their own ten-year medians: P/E of 48.89 against 76.94, and EV/EBITDA of 32.79 against 55.30. The discounted cash flow gives 261.71 USD per share at a discount rate of 9.28%, and the fair value from historical multiples is 483.58 USD. The reverse DCF implies growth of 15.2% a year, against revenue growth of 16.9% a year over five years, so the price asks for slightly less growth than the company has delivered.

What holds the case up is a net cash position, with net debt to EBITDA of -5.47, and ROIC of 280.3% against a WACC of 9.27%. Revenue has grown in each of the last ten years. What would break it is stock-based compensation at 10.8% of revenue, and a DCF value of 261.71 USD that sits below the price of 306.40 USD. The DCF rests on assumptions the analysis cannot verify, so the fair value band should be read as an order of magnitude, not a price target.

Financial health

Financial strength is green, held up by a net cash position, a current ratio of 5.46 and a quick ratio of 5.36, and debt to equity of 0.02. The company does not report its interest expense, so interest coverage is not available. Its Altman Z-score is 20.73, in the safe zone. The Altman model was designed for manufacturers, so this reading is only indicative for a software company. Insolvency risk is low, about 0.01% by the estimate of the Ohlson model over one to two years. Net debt to EBITDA of -5.47 means the company holds more cash than debt, so its debt has been shrinking, with debt against revenue growth at -8.2% over five years.

Earnings quality

Earnings quality is green, with cash conversion and earnings beats as the main supports. Free cash flow conversion is 1.62 on a trailing twelve-month basis and 1.59 over five years, and the accrual ratio is -0.06, which means cash earnings exceed reported earnings. Stock-based compensation is 10.8% of revenue, and free cash flow after it is 1.27 billion USD. The share count has grown by 0.77% a year over five years, so dilution is small. The Piotroski score is 6 of the 8 criteria that could be evaluated. The Beneish M-score reading is not available. The company beat earnings estimates in all 8 of the last quarters, by an average of 12.4%, and analysts raised estimates in the last 30 days, with 26 upward and no downward revisions for the current year.

Profitability

Profitability is green. The gross margin is 75.0% against a ten-year median of 71.9%, the operating margin is 29.9% against 25.5%, and the net margin is 29.3% against 24.5%. Operating margin has been stable, with a stability measure of 12.3%. ROIC is 280.3% against a WACC of 9.27%, which gives a ROIC minus WACC value of 271.0%, and the five-year median ROIC is 66.5%. Return on equity is 13.7%, and the DuPont split shows it is not inflated by leverage: a net margin of 28.4%, an asset turnover of 0.36 and an equity multiplier of 1.24, all as of January 2026. The returns come from margins, not from borrowing.

Growth

Growth is green. Revenue compound growth is 14.0% over three years, 16.9% over five and 22.8% over ten. Earnings per share compound at 21.9% over three years, 18.2% over five and 30.7% over ten. Free cash flow per share grew at 20.7%, 19.7% and 35.2% over the same periods. Revenue grew in all 10 of the last 10 years. Analysts expect next year's earnings per share to grow by 11.1%, and their estimate for it has risen 2.2% over the last 90 days. Growth is expected to slow from its long-run pace.

Valuation

Valuation is yellow, because the verdict is neutral. Against their ten-year medians, the multiples are at a discount: P/E of 48.89 against 76.94 (a premium of -36.5%), EV/EBITDA of 32.79 against 55.30 (-40.7%), price to free cash flow of 30.21 against 47.67 (-36.6%), price to sales of 14.35 against 15.88 (-9.7%) and price to book of 6.68 against 11.71 (-43.0%). The DCF gives 261.71 USD per share, using a 9.28% discount rate, 16.9% growth in the first phase and 2.5% terminal growth. The terminal value is 60.2% of that figure. The fair value from historical multiples is 483.58 USD. The reverse DCF implies growth of 15.2%, against revenue growth of 16.9% and free cash flow per share growth of 19.7% over five years. The cost of debt is assumed, not reported. The fair value rests on fixed assumptions, including a 5% equity risk premium and capped growth. The company pays no dividend.

Risks

Stock-based compensation at 10.8% of revenue dilutes shareholders' economic return even though the share count barely rises, and a slowdown in growth would lower the free cash flow that supports the valuation. A fall in operating margin from 29.9% toward its ten-year median of 25.5% would reduce ROIC and the case for the premium multiples. The DCF value of 261.71 USD is below the current price, and its terminal value share of 60.2% means the result depends heavily on long-term assumptions. The company does not report its interest expense, so interest coverage is not available, and the Beneish M-score is not available. This analysis has no debt maturity schedule and no revenue breakdown by segment, so it cannot assess refinancing risk or which products drive growth.