Contrasting Cotiviti (COTV) and Veeva Systems (VEEV)

Cotiviti (NYSE: COTV) and Veeva Systems (NYSE:VEEV) are both mid-cap healthcare companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, risk, profitability, valuation and earnings.

Earnings & Valuation

This table compares Cotiviti and Veeva Systems’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cotiviti $625.16 million 5.00 $48.85 million $0.98 34.54
Veeva Systems $544.04 million 15.16 $68.80 million $0.91 64.14

Veeva Systems has lower revenue, but higher earnings than Cotiviti. Cotiviti is trading at a lower price-to-earnings ratio than Veeva Systems, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Cotiviti and Veeva Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cotiviti 13.86% 13.61% 6.62%
Veeva Systems 19.97% 12.21% 9.01%

Institutional and Insider Ownership

86.2% of Cotiviti shares are held by institutional investors. Comparatively, 70.9% of Veeva Systems shares are held by institutional investors. 15.8% of Cotiviti shares are held by insiders. Comparatively, 17.5% of Veeva Systems shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations and price targets for Cotiviti and Veeva Systems, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cotiviti 0 3 7 0 2.70
Veeva Systems 0 4 7 0 2.64

Cotiviti presently has a consensus target price of $40.38, suggesting a potential upside of 19.28%. Veeva Systems has a consensus target price of $67.70, suggesting a potential upside of 15.98%. Given Cotiviti’s stronger consensus rating and higher probable upside, equities analysts clearly believe Cotiviti is more favorable than Veeva Systems.

About Cotiviti

Cotiviti Holdings, Inc. is a provider of analytics-driven payment accuracy solutions. The Company focuses primarily on the healthcare sector. The Company operates through two segments: Healthcare, and Global Retail and Other. Through its Healthcare segment, the Company offers prospective and retrospective claims accuracy solutions to healthcare payers in the United States. The Company also provides analytics-based solutions unrelated to its healthcare payment accuracy solutions in the United States. Through its Global Retail and Other segment, the Company provides retrospective claims accuracy solutions to retailers primarily in the United States, Canada and the United Kingdom, as well as solutions that manage payment networks for a range of clients. The Company leverages its technology platform, configurable analytics, information assets and expertise in healthcare reimbursement to help its clients develop their claims payment accuracy.

About Veeva Systems

Veeva Systems Inc. (Veeva) is a provider of cloud-based software solutions for the global life sciences industry. The Company offers solutions for a range of requirements within life sciences companies, including multichannel customer relationship management, regulated content and information management, master data management and customer data. The Company offers solutions to areas, including the Veeva CRM family of applications for multichannel customer relationship management to enable coordinated and personalized customer engagement through multiple touch points; Veeva Vault for regulated content management and information management solutions to enable the management of content-centric processes; the Veeva Network master data management solutions for the management of customer master and product master data, and Veeva’s data and data services offerings, including Veeva OpenData for customer reference data and Veeva KOL Data for data.

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