Endava (DAVA) AI Stock Analysis

• Market Cap: $363.11M
• Dividend Yield: N/A
• Average Volume (3M): 1.18M
• Price to Earnings (P/E): 32.1
• Beta (1Y): 1.32
• Revenue Growth: 4.02%
• EPS Growth: 34.45%
• Country: US
• Employees: 11,668
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 0.20
• Shares Outstanding: 40,782,810
• 10 Day Avg. Volume: 950,708
• 30 Day Avg. Volume: 1,182,326
• PEG Ratio: 1.27
• Price to Book (P/B): 1.12
• Price to Sales (P/S): 0.84
• P/FCF Ratio: 13.57
• Enterprise Value/Market Cap: 2.05
• Enterprise Value/Revenue: 0.99
• Enterprise Value/Gross Profit: 3.98
• Enterprise Value/Ebitda: 11.68
• 1Y Price Target: $10.17
• Price Target Upside: 57.43% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7
• EPS Forecast (FY): 1.05
• Revenue Forecast (FY): $977.17M

• Rating: 58 Neutral
• Price Target: $7.50 ▲(16.10% Upside)

Endava's overall stock score reflects a stable financial position with strong cash flow generation but is weighed down by bearish technical indicators and high valuation concerns. The earnings call further highlights short-term challenges with declining revenues and profitability, despite strategic advancements in AI and partnerships. The stock's current valuation may not be justified given these financial pressures.

Positive Factors

Strategic Partnerships

The partnership with a payments company highlights Endava's strong client relationships and capabilities in AI, supporting long-term growth.

AI Integration

Endava's focus on AI integration positions it well for future growth, aligning with industry trends towards digital transformation.

Cash Flow Generation

Strong cash flow generation enhances financial flexibility, allowing Endava to invest in growth opportunities and weather economic downturns.

Negative Factors

Revenue Decline

A significant revenue decline indicates potential challenges in market demand or competitive positioning, impacting long-term growth.

Profitability Challenges

Profitability challenges could strain resources and limit Endava's ability to reinvest in business development and innovation.

Decreased Revenue from Major Clients

Reduced revenue from major clients suggests potential issues with client retention or satisfaction, affecting long-term revenue stability.

Endava Business Overview & Revenue Model

Company Description

Endava plc provides technology services for clients in the consumer products, healthcare, mobility, and retail verticals in Europe, Latin America, North America, and internationally. The company offers technology and digital advisory services for payments and financial services, and TMT sectors; IT strategies; business analysis services; program management services; digital product strategy services; and architecture, extended reality, machine learning and artificial intelligence, product design, and user experience and visual design services. It also engages in the identifying, defining, and embedding collaborative data and analytics; and provision of automated testing, cloud native software engineering, continuous delivery, distributed agile delivery, intelligent automation, secure development, agile applications management, cloud infrastructure, DevSecOps, service delivery, smart desk, and telemetry and monitoring services. The company was founded in 2000 and is headquartered in London, the United Kingdom.

How the Company Makes Money

Endava generates revenue primarily through its consulting and technology services. The company operates on a project-based revenue model, where it earns fees by delivering bespoke software development and IT consulting solutions tailored to the specific needs of its clients. Key revenue streams include billing for time and materials on projects, fixed-price contracts for specific deliverables, and ongoing managed services agreements. Additionally, Endava has formed partnerships with various technology providers, which may enhance its service offerings and contribute to revenue growth. The company also benefits from a strong client retention rate and recurring revenue from long-term contracts, which provide a stable income base.

Endava Financial Statement Overview

Summary

Endava faces challenges with declining revenue growth and profitability margins, impacting its income statement. The balance sheet remains relatively stable with moderate leverage, but the increase in debt-to-equity ratio is a concern. Cash flow generation has weakened, although the company still maintains a strong free cash flow to net income ratio. Overall, while the company has a solid financial foundation, it needs to address declining growth and profitability to improve its financial health.

Income Statement

Endava's income statement reveals a declining trend in revenue growth, with a significant drop in revenue in the latest year. Profit margins have also decreased, with gross profit margin falling from 33.2% in 2023 to 25.1% in 2025. The net profit margin has similarly declined, indicating pressure on profitability. Despite these challenges, the company maintains positive EBIT and EBITDA margins, though they have decreased over the years.

Balance Sheet

The balance sheet shows a moderate debt-to-equity ratio, which has increased over the years, indicating rising leverage. However, the company maintains a healthy equity ratio, suggesting a stable financial position. Return on equity has decreased, reflecting lower profitability, but the company still retains a solid equity base relative to its assets.

Cash Flow

Cash flow analysis indicates a decline in free cash flow growth, with negative growth in the latest year. The operating cash flow to net income ratio has decreased, suggesting reduced cash generation efficiency. However, the free cash flow to net income ratio remains strong, indicating that the company is still generating cash relative to its net income.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	755.39M	772.25M	740.76M	794.73M	654.76M	446.30M
Gross Profit	187.11M	198.10M	188.81M	264.08M	217.93M	154.18M
EBITDA	63.80M	67.46M	59.57M	142.38M	113.56M	79.19M
Net Income	10.81M	21.21M	17.12M	94.16M	83.09M	43.45M
Balance Sheet
Total Assets	933.74M	935.77M	1.01B	770.12M	621.86M	473.21M
Cash, Cash Equivalents and Short-Term Investments	47.23M	59.47M	62.54M	164.76M	163.20M	70.45M
Total Debt	242.29M	228.05M	202.76M	69.01M	55.90M	63.69M
Total Liabilities	364.96M	352.83M	374.44M	198.81M	189.13M	172.54M
Stockholders Equity	568.78M	582.94M	639.46M	571.31M	432.72M	300.67M
Cash Flow
Free Cash Flow	53.99M	48.07M	48.91M	110.84M	106.75M	82.24M
Operating Cash Flow	60.65M	52.77M	54.39M	124.52M	120.72M	87.67M
Investing Cash Flow	-14.97M	-9.94M	-290.32M	-110.85M	-23.88M	-106.41M
Financing Cash Flow	-51.26M	-45.13M	135.06M	-11.00M	-5.08M	-11.92M

Endava Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 6.46
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DAVA, the sentiment is Negative. The current price of 6.46 is below the 20-day moving average (MA) of 7.37, below the 50-day MA of 8.35, and below the 200-day MA of 14.75, indicating a bearish trend. The MACD of -0.74 indicates Positive momentum. The RSI at 33.68 is Neutral, neither overbought nor oversold. The STOCH value of 44.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DAVA.

Endava Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CINT	67 Neutral	$615.73M	18.80	12.24%	―	8.33%	59.54%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
CCSI	61 Neutral	$544.64M	7.16	―	―	-0.44%	-7.23%
DAVA	58 Neutral	$363.11M	32.14	1.63%	―	4.02%	34.45%
JG	58 Neutral	$39.56M	―	-5.29%	―	19.41%	85.27%
YEXT	56 Neutral	$1.04B	―	4.72%	―	13.51%	―
BAND	52 Neutral	$434.63M	―	-3.20%	―	7.42%	34.42%

Endava Corporate Events

Endava Announces 2025 Annual General Meeting Details

On November 12, 2025, Endava plc announced the distribution of a notice for its Annual General Meeting (AGM) scheduled for December 10, 2025, in London. The company has sent out proxy forms and its annual report for the fiscal year ending June 30, 2025, to shareholders. The AGM will address various resolutions, including the adoption of the annual report, approval of directors’ remuneration, and re-election of board members. This meeting is significant for stakeholders as it will influence the company’s governance and strategic direction.

Endava Reports Q1 FY2026 Results with Strategic Partnership Highlight

On November 11, 2025, Endava announced its financial results for the first quarter of fiscal year 2026, ending September 30, 2025. The company reported a year-on-year revenue decline of 8.6% to £178.2 million, with a diluted loss per share of £(0.15). Despite the revenue drop, Endava secured a significant multi-year strategic partnership with a leading payments company, showcasing its strong client relationships and capabilities in AI and advanced engineering. This partnership is expected to enhance the client’s technology platforms and demonstrates Endava’s strategic focus on leveraging its AI-native, technology-agnostic transformation services.

Endava PLC Releases 2025 Statutory Accounts

Endava PLC announced that its statutory accounts for the year ended June 30, 2025, were approved by the board of directors on September 9, 2025, and delivered to the Registrar of Companies on September 10, 2025. These accounts, prepared in accordance with UK-adopted International Accounting Standards and IFRS, are now available on the company’s website, reflecting Endava’s commitment to transparency and regulatory compliance.

Endava Reports Mixed Financial Results for FY2025 Amid AI Focus

On September 4, 2025, Endava plc announced its financial results for the fourth quarter and fiscal year ending June 30, 2025. The company reported a 3.9% year-on-year revenue decrease for Q4 FY2025, while FY2025 saw a 4.3% revenue increase. Despite a challenging operating environment, Endava achieved its highest quarterly order book and a record full-year signed value. The company remains cautious due to clients recalibrating spending, impacting short-term operations. Endava’s strategic focus on AI is evident, with over half of its workforce now utilizing AI in projects, marking significant progress toward becoming AI-native.