Coveo Solutions (CVO) AI Stock Analysis

• Market Cap: C$782.77M
• Dividend Yield: N/A
• Average Volume (3M): 124.72K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.28
• Revenue Growth: 9.08%
• EPS Growth: 37.74%
• Country: CA
• Employees: 743
• Sector: Technology
• Sector Strength: 89
• Industry: Software - Infrastructure
• EPS (TTM): -0.10
• Shares Outstanding: 55,648,907
• 10 Day Avg. Volume: 88,066
• 30 Day Avg. Volume: 124,715
• PEG Ratio: 1.35
• Price to Book (P/B): 3.99
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 57.39
• Enterprise Value/Market Cap: 0.55
• Enterprise Value/Revenue: 0.82
• Enterprise Value/Gross Profit: 4.10
• Enterprise Value/Ebitda: -11.05
• 1Y Price Target: C$10.58
• Price Target Upside: 33.75% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 73 Outperform
• Price Target: C$8.50 ▲(7.46%Upside)

Coveo Solutions' strong technical momentum and positive corporate events, particularly the strategic focus and revenue growth, are significant strengths. These factors are balanced against valuation concerns due to net losses and the negative P/E ratio, resulting in a moderate overall score.

Positive Factors

Customer Growth

The company is experiencing strong growth in its GenAI customer base, with Commerce being the fastest-growing use case.

Growth Outlook

The growth outlook for Coveo Solutions, Inc. remains strong and is expected to accelerate.

Valuation

Coveo is considered significantly undervalued given its market position, customer list, and high-teens SaaS growth targeted for FY2026.

Negative Factors

EBITDA Guidance

EBITDA guidance is lighter than expected as Coveo is increasing investments to better capitalize on market opportunities.

Investment Impact

Guidance was in line on SaaS revenue but lighter on EBITDA, as CVO is ramping up investments in order to better capitalize on its market opportunity.

Coveo Solutions Business Overview & Revenue Model

Company Description

Coveo Solutions Inc. provides applied artificial intelligence (AI) solutions. Its cloud-native, multi-tenant software as a service (SaaS) platform is the intelligence layer that injects search, recommendations, and personalization solutions into digital experiences to provide connected relevance for various-use cases across commerce, service, website, and workplace applications. It serves high tech, healthcare, manufacturing, financial services, and telecommunication industries. Coveo Solutions Inc. has strategic technology partnerships with Adobe, SAP, Salesforce, ServiceNow, Zendesk, Sitecore, AppDirect, and commercetools. The company was incorporated in 2004 and is headquartered in Quebec, Canada.

How the Company Makes Money

Coveo Solutions generates revenue through a subscription-based model, providing its AI-powered search and relevance solutions to businesses across various industries. The company's key revenue streams include software licensing fees, subscription services, and professional services such as implementation and support. Additionally, Coveo has strategic partnerships with major technology companies, which help expand its market reach and enhance its product offerings. These partnerships, along with a focus on innovation and customer satisfaction, significantly contribute to the company's earnings.

Coveo Solutions Financial Statement Overview

Summary

Coveo Solutions exhibits strong revenue growth and robust cash flow management. The company maintains a healthy balance sheet with low leverage. However, ongoing net losses and negative ROE indicate profitability challenges.

Income Statement

Coveo Solutions has shown positive revenue growth over the years, with a revenue growth rate of 5.71% in the latest year. The gross profit margin is robust at 78.69%, indicating strong cost management. However, the company is still operating at a net loss, with a negative net profit margin of -10.32%, and negative EBIT and EBITDA margins, reflecting ongoing challenges in achieving profitability.

Balance Sheet

The company has a healthy equity position, with a high equity ratio of 55.09%. The debt-to-equity ratio stands at a modest 0.06, indicating low leverage. However, the ROE is negative at -10.84% due to net losses, highlighting the need for improved profitability to enhance shareholder returns.

Cash Flow

Coveo Solutions has demonstrated strong cash flow management, with a significant improvement in operating cash flow. The free cash flow growth rate is an impressive 209.72%, and the free cash flow to net income ratio is positive, indicating effective cash generation despite net losses. The operating cash flow to net income ratio is also positive, showing good cash conversion efficiency.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	133.27M	126.09M	112.00M	86.49M	64.86M
Gross Profit	104.88M	98.45M	85.33M	65.03M	48.45M
EBITDA	-5.06M	-12.20M	-30.32M	249.60M	-468.47M
Net Income	-13.75M	-23.61M	-39.73M	418.28M	-600.02M
Balance Sheet
Total Assets	230.36M	275.88M	308.82M	345.50M	194.04M
Cash, Cash Equivalents and Short-Term Investments	124.75M	166.59M	198.45M	223.07M	131.87M
Total Debt	7.46M	9.04M	10.87M	13.09M	209.84M
Total Liabilities	103.45M	97.36M	90.28M	90.06M	1.19B
Stockholders Equity	126.91M	178.52M	218.53M	255.44M	-999.08M
Cash Flow
Free Cash Flow	9.54M	3.08M	-7.85M	-37.57M	2.19M
Operating Cash Flow	11.07M	4.20M	-6.26M	-35.42M	5.78M
Investing Cash Flow	-1.53M	-1.12M	-2.27M	36.62M	30.71M
Financing Cash Flow	-50.81M	-35.59M	-2.43M	163.40M	2.18M

Coveo Solutions Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7.91
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CVO, the sentiment is Positive. The current price of 7.91 is above the 20-day moving average (MA) of 7.50, above the 50-day MA of 7.08, and above the 200-day MA of 6.42, indicating a bullish trend. The MACD of 0.21 indicates Negative momentum. The RSI at 70.92 is Negative, neither overbought nor oversold. The STOCH value of 88.95 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:CVO.

Coveo Solutions Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CVO	73 Outperform	C$782.77M	―	-9.00%	―	9.08%	37.74%
Sector *	63 Neutral	$33.87B	5.80	-11.87%	1.82%	5.31%	-18.50%
STC	63 Neutral	C$288.49M	―	-2.67%	―	-1.72%	76.81%
FOBIF		$6.57M	―		―	―	―
DND	55 Neutral	C$687.46M	―	-39.72%	0.73%	2.47%	19.37%
PLUR	48 Neutral	C$18.06M	―	-1525.80%	―	0.55%	69.82%
TIXT		$1.07B	30.46	-5.70%	―	―	―

Coveo Solutions Corporate Events

Coveo Solutions Reports Record Fourth Quarter Performance and Strategic Shift

Coveo Solutions announced its financial results for the fourth quarter and fiscal year 2025, highlighting the best fourth-quarter new business performance in its history and a significant increase in generative AI customers. The company reported a 6% increase in total revenue to $133.3 million for FY25, with a notable 11% growth in its core platform’s SaaS subscription revenue. Despite a net loss of $13.8 million, Coveo achieved positive cash flows from operating activities of $11.1 million, reflecting a strategic focus on its core platform and the deprecation of the Qubit Platform. This strategic shift is expected to enhance growth and operational efficiency, positioning Coveo for continued innovation and customer excellence in fiscal year 2026.

The most recent analyst rating on (TSE:CVO) stock is a Buy with a C$12.00 price target. To see the full list of analyst forecasts on Coveo Solutions stock, see the TSE:CVO Stock Forecast page.