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Veeva Systems Inc. (VEEV) Intrinsic Value

DCF-based fair value calculation with Bear, Base, and Bull scenarios

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Veeva Systems Inc. (VEEV)

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Intrinsic Value (DCF)

Current$218.95
→
Intrinsic$195.76
-11%
$135.41$195.76$310.35
Market implies 23% growth for 5 years
VEEV appears fairly valued — current price aligns with our DCF estimate.
At $219, the market prices in continued strong cash flow growth (23%) — likely reflecting buybacks, margin stability, and ecosystem strength.
Range: Bear $135 → Bull $310. Current price implies expectations above the base case, closer to bull expectations.
Discount ↓Growth →16%18%20%22%
8%$237$256$277$299
10%$169$182$196$211
12%$131$140$151$162
14%$107$114$122$131

Bull Case

  • Bull case ($310) offers 42% upside at 24% growth, 9% discount

Bear Case

  • Bear case ($135) implies 38% downside at 16% growth, 12% discount
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5-Year Free Cash Flow Projection

Year 1$1.28B
Year 2$1.54B
Year 3$1.85B
Year 4$2.22B
Year 5$2.66B
Terminal$39.15B

📐 Model Inputs

Growth Rate20.0%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$1.07BTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
ℹ️

DCF estimates based on historical growth rates extrapolated forward. See FAQ below for full methodology.

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Frequently Asked Questions

Is VEEV stock undervalued or overvalued?
🔴 OVERVALUED

VEEV trades at $218.95 vs. our DCF-derived intrinsic value of $195.76, implying -18% downside. Using a 10.0% WACC and 20.0% FCF growth assumption, the current price requires growth rates above our estimates to be justified. Even our bull case ($291.75) suggests limited upside.

What is VEEV's intrinsic value?

Using a 5-year DCF model: Base FCF of $1.07B, projected at 20.0% 5Y CAGR (best of revenue, EPS, or FCF growth), discounted at 10.0% WACC, with 3.0% terminal growth. Terminal value calculated via Gordon Growth Model: TV = FCF₅ × (1+g) / (WACC−g). After deducting $-1.04B net debt and dividing by 0.17B shares: Bear $130.58 | Base $195.76 | Bull $291.75. Current price $218.95 implies -18% to base case.

How is VEEV's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 20.0% growth derived from 5-year historical CAGR (best of revenue, EPS, or FCF growth, with 8% floor and 25% cap).

② Calculate terminal value at year 5 using perpetuity growth model with g=3.0%.

③ Discount all cash flows to PV using WACC=10.0%.

④ Sum PV of explicit period + PV of terminal value = Enterprise Value ($31.30B).

⑤ Subtract net debt, divide by shares outstanding.

Sensitivity analysis available above—adjust WACC ±2% or growth ±3% to stress-test the valuation. Implied EV/FCF multiple: 29.3x.