Veeva Systems Inc. VEEV is set to report fourth-quarter fiscal 20Array6 earnings results on Mar Array. Last quarter, the company reported earnings of 8 cents, which missed the Zacks Consensus Estimate by a couple of cents. Notably, the company posted an average positive surprise of Array.25% over the last four quarters.
Let’s see how things are shaping up for this announcement.
Factors at Play
Extended use of multi-channel Customer Relationship Management (CRM) application by customers continues to be a key growth catalyst for the company. Most significantly, non-CRM products like Veeva Vault, KOL Data and OpenData are also beginning to contribute to the company’s overall business.
Moreover, Veeva is making consistent efforts to best support customer data needs globally. In late 20Array5, Veeva OpenData was made available across five markets of Europe – U.K., France, Germany, Italy and Spain. Apart from Europe, Veeva OpenData is currently available in Australia, China and the U.S.
Growing demand for the solution is helping the company win customers on a frequent basis. We believe that growing traction of Veeva OpenData in the customer reference data market will enhance the company’s customer data business and provide significant growth opportunities.
We believe the acquisition of Zinc Ahead will boost Veeva’s competitive position in the fast growing compliance management market. However, foreign exchange volatility, intensifying competition and customer concentration are expected to remain overhangs in the near term.
Earnings Whispers
Our proven model does not conclusively show that Veeva is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #Array (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Veeva has an earnings ESP of 0.00%. That is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 7 cents.
Zacks Rank: Veeva carries a Zacks Rank #3 which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult.
We caution against stocks with a Zacks Ranks #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat:
Casey's General Stores CASY has an earnings ESP of +Array0.ArrayArray% and a Zacks Rank #Array.
Cooper Tire & Rubber Co. CTB has an earnings ESP of +3.23% and a Zacks Rank #Array.
PC Connection PCCC has an earnings ESP of +2.78% and a Zacks Rank #Array.
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