Critical Survey: Veeva Systems (NYSE:VEEV) vs. GoodRx (NASDAQ:GDRX)

GoodRx (NASDAQ:GDRX) and Veeva Systems (NYSE:VEEV) are both healthcare companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, earnings, profitability, institutional ownership, valuation and analyst recommendations.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
GoodRx	2.07%	7.22%	2.53%
Veeva Systems	28.37%	13.72%	11.31%

Institutional and Insider Ownership

63.8% of GoodRx shares are held by institutional investors. Comparatively, 88.2% of Veeva Systems shares are held by institutional investors. 5.9% of GoodRx shares are held by insiders. Comparatively, 10.6% of Veeva Systems shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

GoodRx has a beta of 1.6, suggesting that its stock price is 60% more volatile than the S&P 500. Comparatively, Veeva Systems has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500.

Valuation and Earnings

This table compares GoodRx and Veeva Systems”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GoodRx	$796.85 million	1.48	$30.44 million	$0.04	86.25
Veeva Systems	$3.32 billion	12.15	$908.91 million	$5.61	44.25

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

Analyst Recommendations

This is a summary of current recommendations and price targets for GoodRx and Veeva Systems, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GoodRx	3	6	4	0	2.08
Veeva Systems	1	8	19	0	2.64

GoodRx currently has a consensus price target of $4.23, indicating a potential upside of 22.53%. Veeva Systems has a consensus price target of $255.58, indicating a potential upside of 2.95%. Given GoodRx’s higher probable upside, equities analysts plainly believe GoodRx is more favorable than Veeva Systems.

Summary

Veeva Systems beats GoodRx on 11 of the 14 factors compared between the two stocks.

About GoodRx

GoodRx Holdings, Inc., together with its subsidiaries, offers information and tools that enable consumers to compare prices and save on their prescription drug purchases in the United States. The company operates a price comparison platform that provides consumers with curated, geographically relevant prescription pricing, and access to negotiated prices. It also offers other healthcare products and services, including subscriptions, and pharma manufacturer solutions, as well as telehealth services through the GoodRx Care platform. It serves pharmacy benefit managers who manage formularies and prescription transactions, including establishing pricing between consumers and pharmacies. The company was founded in 2011 and is headquartered in Santa Monica, California.

About Veeva Systems

Veeva Systems Inc. provides cloud-based software for the life sciences industry. It offers Veeva Commercial Cloud, a suite of software and analytics solutions, such as Veeva customer relationship management (CRM) that enable customer-facing employees at pharmaceutical and biotechnology companies; Veeva Vault PromoMats, an end-to-end content and digital asset management solution; Veeva Vault Medical that provides source of medical content across multiple channels and geographies; Veeva Crossix, an analytics platform for pharmaceutical brands; Veeva OpenData, a customer reference data solution; Veeva Link, a data application that allows link to generate real-time intelligence; and Veeva Compass includes de-identified and longitudinal patient data for the United States. The company also provides Veeva Development Cloud, a suite of applications for the clinical, regulatory, quality, and safety functions, including Veeva Vault Clinical, Veeva Vault RIM, Veeva Vault Safety, and Veeva Vault Quality; Veeva QualityOne, a quality and document management, and training solution; Veeva RegulatoryOne, a solution that helps companies to manage regulatory submission content; and Veeva Claims addresses the end-to-end product and marketing claims management process. In addition, it offers professional and support services, including implementation and deployment planning and project management; requirements analysis, solution design, and configuration; systems environment management and deployment services; services focused on advancing or transforming business and operating processes related to Veeva solutions; data migration and systems integrations technical consulting services; training on its solutions; and ongoing managed services, such as outsourced systems administration. The company was formerly known as Verticals onDemand, Inc. and changed its name to Veeva Systems Inc. in April 2009. Veeva Systems Inc. was incorporated in 2007 and is headquartered in Pleasanton, California.