Veeva Systems (VEEV) - Overcoming Seven Key Risks, A Sleep-Well Investment? [Part 2]
What are the key ingredients that can help Veeva endure challenges and its fair value?
Hi, I am Trung. I write 10+K words deep-dives on market leaders. I also write Thesis Trackers updates to follow up on their performance. When the right price comes, I buy them for the Sleep Well Portfolio, which I am building for my 4-year-old daughter to redeem in 2037. I disclose the reasoning of all BUY and SELL (ideally never) transactions (1st, 2nd, and 3rd). Join me in building generational wealth.
Hi SWIs,
This is part 2 of my deep dive into Veeva Systems $VEEV (VEEV), a $27B market leader in life science. Please read Part 1 to understand the critical risks to the business.
Here, I show you the key ingredients that can make Veeva a sleep-well investment and attempt to determine an entry price that would offer a sufficient margin of safety in case we get this wrong.
Part 2 begins with:
Why is it a sleep-well business?
How critical is the product?
How enduring is the business model?
What is the growth potential and outlook?
What competitive advantages does Veeva have over peers?
How anti-fragile is the business?
Management’s competency and alignment
What’s a fair price?
base case
bear case
Sleep Well Scorecard
How do you track Veeva?
If you missed Part 1, I discussed the following key risks:
IQVIA, a $40B elephant, is the most significant risk to Veeva’s Commerical (CRM) and Data Cloud (particularly Compass and Crossix). As Veeva modernizes the data design and application structure, does it have the edge over IQVIA’s offering?
IQVIA’s decade-long lawsuit against Veeva for data misuse remains unsettled, restricting Veeva’s customers from integrating IQVIA’s third-party data into Veeva’s multiple applications, including Network Customer Master and Nitro. Which other applications are negatively impacted?
Salesforce (CRM), the leader in generic CRM platforms, has created Healthcare to enter life science. But after recruiting Frank Defesche, the former General Manager of Veeva’s Vault, in November 2023, will that change the competition dynamics?
Meanwhile, Veeva is migrating its CRM capabilities to Veeva Vault from Salesforce. Management lauded the long-term gains, but the disruption will increase churn.
Medidata’s Rave and Oracle’s Phase Forward are formidable competitors in specific applications, namely electronic data capture (EDC) and clinical data management. But can they go beyond these functions to disrupt Veeva?
AI - What is Veeva doing to ensure it becomes an opportunity, not a risk?
Loss of exclusivity (LoEs) and the biopharma funding cycle are cyclical risks as R&D and CRM funding cuts worsen, reducing drug development activities. But, could it motivate biopharma to improve efficiency and increase investment in R&D solutions?
Why is Veeva a sleep-well business?
Essential product and a preferred platform
The first criterion of an enduring business is whether it provides essential or mission-critical service to its customers that they can’t easily find a replacement or build themselves.