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Veeva Systems: Buy This Growth Machine

Mar. 05, 2018 12:51 PM ETVeeva Systems Inc. (VEEV)5 Comments
Josh Rudnik profile picture
Josh Rudnik


  • VEEV's share price is breaking out higher.
  • It continues to deliver strong fundamental growth.
  • I am buying stock with a $68 stop-loss point.

Veeva Systems (NYSE:VEEV) is breaking out higher on strong fundamental growth. The combination of fundamental growth leading its share price higher is a positive long-term trend. VEEV is expanding internationally, with highly developed life sciences technology, potentially becoming a leader in future drug development technology. The company's share price is breaking out higher to record levels, and continues to show strong upward momentum. I am buying stock with a tight $68 stop-loss level should my thesis be proven incorrect and investor sentiment wanes.

Price Action

VEEV's share price is trending strongly higher on improved fundamental results. The company continues to impress on top- and bottom-line growth, which is leading to equally impressive price action. On both its short- and long-term charts, VEEV looks strong. On its monthly-chart, the company is breaking out to record high levels. This comes after a recent consolidation and breakout following positive earnings results.

On shorter-term charts, VEEV's breakout above $68 was significant. This level had acted as significant resistance in recent months, but price action moved well above this level on strong investor momentum. I am setting a stop-loss level at $68, expecting this stock to continue to run higher.

Source: Trading View

Fundamental Narrative

VEEV continues to impress investors with stronger top- and bottom-line revenue due to expanding international growth in its cloud-based services. Over the most recent quarter, total revenue came in at $185 million, up 23% year-over-year. The was led by subscription revenue growth of 26%, with operating margins at 28%. Growth was largely driven by progress in each of its markets, as well as continued innovation overseas.

The company's cloud technology continues to show strong commercial growth. VEEV's commercial cloud is a suite of multi-channel customer relationship management applications, which allow pharmaceutical and biotechnology companies to target and support sales and marketing to

This article was written by

Josh Rudnik profile picture
I am currently a portfolio manager at an RIA in Philadelphia with over $1 billion in assets. The portfolio is dedicated towards macro themed positioning with equities, ETFs, fixed income, as well as options and other alternatives. There are opportunities everywhere, both on the long and short side, and I aim to generate absolute returns on an annualized basis for clients. My absolute return portfolio has returned double-digit percentage returns over the last decade regardless of if the market is selling off, or rallying higher with enthusiasm. Relative returns are nice, but at the end of the day, you can't eat relative returns. When the S&P 500 is down 20%, it doesn't necessarily mean you have to be down too. Join my Marketplace service, Absolute Returns, and see how I am positioning my portfolio in real-time, and what trade ideas are coming about daily. I also offer a live chat as part of the service, where questions and ideas can be discussed.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (5)

What a bad move to quit this company as an employee! I could make the same with stocks over time.
Rodney Beasley profile picture
I think VEEV is a must own stock, not widely followed.
Only been only been public since 2013 and is getting major traction.
Definitely worthy of a watch and buy on any weakness.
Love this one.
Josh Rudnik profile picture
Agree, article was drafted on 2/28, but i think this company has a lot of potential
With stock at $76 today I am assuming your wrote this a few days ago and just published.
Margins over next 24 months may exceed your and consensus expectations. Scale from several initiatives, cross selling and increase of average new orders will add 200-300 points?
The upcoming Philly meetings may well surprise who is in audience and some of the new verticals being entered. Look and read the name tags. TAM much larger than cynics believe. International will see a much bigger push and pull in 2019. Certainly volatility given high near term P/E BUT cash on the balance sheet, pending customer announcements in clinical and International can take us to over $100 in next 36 months. IMHO
After some due diligence, I bought this stock according to Rick Pendergraft, Daily Trade Alert on January 30, 2018. I am currently happy with the increasing trend of Veeva Systems.... Thanks
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