Coveo Solutions (CVO) AI Stock Analysis

• Market Cap: C$848.05M
• Dividend Yield: N/A
• Average Volume (3M): 160.86K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.40
• Revenue Growth: 10.09%
• EPS Growth: -8.79%
• Country: CA
• Employees: 743
• Sector: Technology
• Sector Strength: 83
• Industry: Software - Infrastructure
• EPS (TTM): -0.22
• Shares Outstanding: 56,014,156
• 10 Day Avg. Volume: 150,352
• 30 Day Avg. Volume: 160,863
• PEG Ratio: 0.69
• Price to Book (P/B): 2.91
• Price to Sales (P/S): 2.77
• P/FCF Ratio: 38.72
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$11.30
• Price Target Upside: 26.26% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 69 Neutral
• Price Target: C$9.50 ▲(6.15% Upside)

Coveo Solutions' overall score is driven by strong technical momentum and positive corporate events, indicating growth potential. However, challenges in profitability and valuation concerns due to negative earnings impact the score. The company's strategic focus on AI and partnerships offers a promising outlook, but financial performance improvements are needed for a stronger score.

Positive Factors

Growth Outlook

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

Stock Recommendation

The analyst has issued a 'BUY' recommendation for the stock of Coveo Solutions, Inc.

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 Expenses

Coveo is ramping up investments in R&D and sales/marketing to prepare for future growth, indicating stronger demand and better unit economics.

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 makes money primarily through a subscription-based revenue model. The company offers its AI-powered search and recommendation platform as a software-as-a-service (SaaS), where businesses pay recurring fees to access its services. Key revenue streams include subscriptions from various industries such as retail, technology, finance, and telecommunications that utilize Coveo's solutions to enhance their digital customer experiences. The company also generates income from professional services, including implementation, training, and support, which assist clients in maximizing the value of their investment in Coveo's technology. Significant partnerships with technology providers and systems integrators further contribute to the company's earnings by expanding its market reach and offering integrated solutions.

Coveo Solutions Financial Statement Overview

Summary

Coveo Solutions has shown strong revenue growth and cash flow management, with a revenue growth rate of 5.71% and a robust gross profit margin of 78.69%. Despite these positives, the company faces profitability challenges with a negative net profit margin of -10.32% and negative ROE, indicating the need for improved profitability.

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	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	136.60M	133.27M	126.09M	112.00M	86.49M	64.86M
Gross Profit	107.06M	104.88M	98.45M	85.33M	65.03M	48.45M
EBITDA	-8.04M	-5.06M	-12.20M	-30.32M	249.60M	-468.47M
Net Income	-22.70M	-13.75M	-23.61M	-39.73M	418.28M	-600.02M
Balance Sheet
Total Assets	222.60M	230.36M	275.88M	308.82M	345.50M	194.04M
Cash, Cash Equivalents and Short-Term Investments	128.47M	124.75M	166.59M	198.45M	223.07M	131.87M
Total Debt	7.28M	7.46M	9.04M	10.87M	13.09M	209.84M
Total Liabilities	100.39M	103.45M	97.36M	90.28M	90.06M	1.19B
Stockholders Equity	122.21M	126.91M	178.52M	218.53M	255.44M	-999.08M
Cash Flow
Free Cash Flow	13.81M	9.54M	3.08M	-7.85M	-37.57M	2.19M
Operating Cash Flow	15.14M	11.07M	4.20M	-6.26M	-35.42M	5.78M
Investing Cash Flow	-1.33M	-1.53M	-1.12M	-2.27M	36.62M	30.71M
Financing Cash Flow	-53.74M	-50.81M	-35.59M	-2.43M	163.40M	2.18M

Coveo Solutions Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8.95
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 8.95 is above the 20-day moving average (MA) of 8.81, above the 50-day MA of 8.16, and above the 200-day MA of 6.87, indicating a bullish trend. The MACD of 0.20 indicates Positive momentum. The RSI at 59.10 is Neutral, neither overbought nor oversold. The STOCH value of 51.21 is Neutral, 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	69 Neutral	C$848.05M	―	-17.77%	―	10.09%	-8.79%
Sector *	61 Neutral	$34.98B	7.37	-10.82%	1.91%	8.82%	-8.66%
STC	60 Neutral	C$266.37M	―	-2.67%	―	-1.72%	76.81%
FOBIF	―	$6.49M	―		―	―	―
DND	55 Neutral	C$679.10M	―	-39.72%	0.72%	2.47%	19.37%
PLUR	47 Neutral	C$15.71M	―	-1525.80%	―	5.61%	72.77%
TIXT	―	$1.06B	30.46	-20.44%	―	―	―

Coveo Solutions Corporate Events

Coveo Solutions Reports Strong Start to Fiscal 2026 with AI-Driven Growth

Coveo Solutions has reported a robust start to its fiscal year 2026, with a notable reacceleration in growth driven by its core platform and generative AI solutions. The company achieved a 16% growth rate for its core platform and saw generative AI solutions contribute to approximately 50% of new business. Coveo’s strategic relationship with SAP has been significantly expanded, positioning it as a key AI partner and enhancing its market leadership. Despite a net loss of $15.1 million, Coveo’s cash flow from operating activities improved significantly, reflecting strong business momentum and customer adoption across diverse regions and use cases.

The most recent analyst rating on (TSE:CVO) stock is a Buy with a C$10.00 price target. To see the full list of analyst forecasts on Coveo Solutions stock, see the TSE:CVO Stock Forecast page.

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.