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Veeva Systems (VEEV) to Post Q3 Earnings: What's in Store?

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Zacks Equity Research
·4 min read
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Veeva Systems Inc. VEEV is scheduled to release third-quarter fiscal 2021 results on Dec 1, after the closing bell.

In the last reported quarter, the company delivered an earnings surprise of 12.5%. Further, its beat estimates in each of the trailing four quarters, the average surprise being 10.3%.

Q3 Estimates

The Zacks Consensus Estimate for the company’s fiscal third-quarter earnings is pegged at 68 cents, suggesting an improvement of 13.3% from the year-ago quarter. The same for revenues stands at $361.5 million, indicating growth of 28.7% from the prior-year reported figure.

Factors to Note

Veeva Systems unique product portfolio, comprising Veeva Vault, Veeva CRM, Veeva Network and Veeva OpenData, might have driven the fiscal third-quarter performance.

The company’s first cloud-based content management system, built specifically for life sciences — Veeva Vault — is likely to have added new Vault customers in the quarter to be reported.

Strength across each Vault application area, including continued momentum in more established products and early success for new products, may have benefited the to-be-reported quarter’s performance.

Veeva Systems Inc. Price and EPS Surprise

Veeva Systems Inc. Price and EPS Surprise
Veeva Systems Inc. Price and EPS Surprise

Veeva Systems Inc. price-eps-surprise | Veeva Systems Inc. Quote

Further, Veeva Commercial Cloud and Veeva Vault are likely to have contributed to Professional Service and Other segment’s revenues in the to-be-reported quarter. Additionally, Veeva Systems’ subscription revenues might reflect increase in bookings in the fiscal third quarter.

Strong performance across Veeva Systems’ segments — Subscription Service and Professional Service and Others — is likely to get reflected in the to-be-reported quarter’s revenues. Notably, the company expects revenues between $360 million and $362 million in third-quarter fiscal 2021.

Moreover, in May 2020, the company announced MyVeeva for clinical trials. Notably, it is a software designed to enable clinical research sites to interact more remotely with their patients when required so that they can have a mix of in-office and virtual visits.

Further in the same month, the company announced that Alvotech, a biopharmaceutical company specializing in biosimilars, adopted Veeva Vault Training for more effective role-based training across its organization.

In June 2020, the company announced Veeva Link for KAM, a new solution that generates commercial and medical teams’ precise customer data and real-time insights for key account management. Veeva Link for KAM integrates data and AI-driven insights on key people and key accounts from thousands of scientific and digital sources.

Management anticipates significant contribution from the Crossix and Physicians World buyouts in fiscal 2021 with the estimate between $90 million and $95 million.

These positive developments are likely to get reflected in the fiscal third-quarter results.

However, escalating expenses on the operational side might have weighed on Veeva Systems’ margins.

What Our Quantitative Model Suggests

Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here as you will see.

Earnings ESP: Veeva Systems has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Zacks Rank: It carries a Zacks Rank #3.

Peer Releases

Some better-ranked stocks in the broader medical space that have already announced their quarterly results include Thermo Fisher Scientific Inc. TMO, Align Technology, Inc. ALGN and AngioDynamics, Inc. ANGO, each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Align Technology reported third-quarter 2020 adjusted EPS of $2.25, which surpassed the Zacks Consensus Estimate by 281.4%. Revenues of $734.1 million outpaced the consensus mark by 38%.

Thermo Fisher reported third-quarter 2020 adjusted EPS of $5.63, beating the Zacks Consensus Estimate by 28.8%. Revenues of $8.52 billion surpassed the consensus mark by 10%.

AngioDynamics reported first-quarter fiscal 2021 adjusted earnings per share (EPS) of 2 cents against the Zacks Consensus Estimate of a loss per share of 6 cents. Revenues of $70.2 million beat the consensus mark by 6.9%.

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