CVO stock is a buy, Eight Capital says

Following meetings with the company, Eight Capital analyst Adhir Kadve thinks there is money to be made on Coveo Solutions (Coveo Solutions Stock Quote, Chart, News, Analysts, Financials TSX:CVO).

The analyst says recent marketing meetings have reinforced his positive view on CVO.

“Eight Capital hosted Coveo Chief Financial Officer Brandon Nussey and Chief Business Officer Nicholas Goode for a series of US marketing meetings. We came away from the meetings incrementally positive on Coveo’s ability to drive a reacceleration of growth in F25 and improve its profitability moving forward. This was based upon several positive data points we received pertaining to key discussion topics, including the SAP channel as a key growth driver, Relevance Generative Answering seeing early product market fit, and increased M&A optionality.”

In a research update to clients September 26, Kadve maintained his “Buy” rating and one-year price target of $13.50 on CVO.

The analyst thinks Coveo will post Gross Profit of $100.1-million on revenue of $128.0-million in fiscal 2024. He expects those numbers will improve to Gross Profit of $120.5-million on a topline of$153.2-million the following year.

What does Coveo Solutions do? (via company handout)

“Coveo believes artificial intelligence is a competitive imperative to deliver the relevant and effective digital experiences people expect, at scale, while maximizing business outcomes and profitability. Coveo accelerates the adoption of AI platforms in enterprises, helping them deliver individualized, trusted and connected experiences that lead to exceptional business performance.

The Coveo Relevance Cloud platform is a market-leading AI platform that combines AI search, AI recommendations, GenAI answering, AI models and analytics. The platform drives personalization and merchandising intelligence in digital experiences across commerce, service, website and workplace applications. Coveo’s platform is designed for scale, security and compliance, and can easily integrate into almost any digital user experience a large enterprise delivers with trust. The platform is cloud-native SaaS (software as a service), multitenant, API first and headless.

Coveo has been a pioneer in the application of AI within enterprise digital experiences for more than a decade. The Coveo Relevance Generative Answering capability, which integrates LLM technology with Coveo’s platform to feed generative AI with a common, secure unified index and real-time content and embeddings, helps to drive relevance at scale and consistent factuality, with secure and traceable sources of truth across all channels. Specifically, this helps to solve the key challenges of utilizing generative AI for enterprise use cases.

Coveo helps hundreds of the world’s leading brands create tangible financial value. The company believes its platform is differentiated by its sophisticated applied AI, designed to deliver highly relevant, bespoke digital experiences that drive superior business outcomes. In addition, the platform’s scalability, rapid time to value, enterprise-grade security and compliance, and native integrations with other third party technology applications, set Coveo apart. Coveo is a Salesforce Summit ISV partner, an SAP endorsed app and an Adobe Gold partner.”