Endava (DAVA): What's Happening and What to Watch For

Stock Symbol: DAVA Generate Date: 2025-04-26 10:30:25

Alright, let's break down what's been going on with Endava stock based on the latest info.

Recent News Buzz

So, what's the story from the news? We saw a couple of analyst updates back in February. Both Susquehanna and Needham kept their positive ratings on Endava, which is a good sign – they still think the company is solid. However, both firms did trim their price targets a bit. Susquehanna lowered theirs from $55 to $50, and Needham dropped theirs from $43 to $38. This suggests that while they remain optimistic about the company itself, they might see a slightly less aggressive climb for the stock price in the near future compared to their previous expectations.

Right around the same time, Endava released its second-quarter results for fiscal year 2025. The company reported revenue growth, which is a definite positive – up 6.6% year-over-year (or 9.1% if you account for currency changes). That shows the business is still expanding. On the flip side, the reported diluted earnings per share (EPS) actually dipped slightly compared to the same period last year (£0.11 vs £0.14). The adjusted EPS stayed flat at £0.30. So, the financials were a bit of a mixed bag: revenue up, but profit per share facing some pressure. This mixed financial picture likely influenced those analyst target adjustments we just talked about.

Checking the Price Chart

Now, let's look at what the stock price has actually been doing. Looking back over the last couple of months, it's been a pretty rough ride for DAVA shareholders. Back in mid-February, the stock was trading comfortably above $30, even touching nearly $35 at one point. But right after those earnings and analyst updates hit, the price took a significant nosedive. It dropped sharply into the low $20s and kept sliding, hitting a 52-week low of $16.60 in early April.

More recently, in April, the price seems to have found some footing and has been bouncing around in the high teens. It closed yesterday near $18.89. So, while it's recovered a little from its absolute low, it's still trading way down from where it was just a couple of months ago.

What about the immediate future? The AI prediction model sees the price staying flat today, then ticking up slightly by about 1.1% tomorrow and another 0.5% the day after. These are small predicted moves, but they suggest the AI sees a tiny bit of upward momentum right now.

What Does It All Suggest?

Putting the pieces together, we have a company with continued revenue growth but some pressure on reported profits, analysts who still like the company but have lowered their price expectations, and a stock price that has seen a dramatic decline since February but might be trying to stabilize in the high teens.

The recommendation data provided points to some interesting technical signals appearing recently, like strong buying pressure (high volume) and a bullish crossover in a key indicator (MACD), happening near what looks like a support level around the current price. This data gives the stock a "Bullish Momentum" tag and a decent overall recommendation score, despite highlighting some fundamental concerns like a high P/E ratio (though the Yahoo Finance data shows a much lower P/E of 8.92x, which is less concerning than the 171.7x mentioned elsewhere, but the low growth, low return on equity, and high debt are still noted issues) and high debt.

Given the big price drop that's already happened and these recent technical signals suggesting potential support and buying interest around the current levels, the situation might be interpreted as one where the stock is attempting to bottom out after the negative reaction to the February news.

For someone considering this stock, the current price area, around yesterday's close near $18.89, aligns pretty closely with the potential entry points ($18.72 - $18.86) suggested by the recommendation data. This could be a level where buyers are testing the waters, hoping for a bounce.

If you were looking at potential price levels based on this data, the recommendation suggests a stop-loss around $17.02. This is a level below recent trading and could be used as a point to consider exiting if the price continues to fall, helping to manage risk. On the upside, a potential take-profit level is suggested around $19.29. These are just ideas based on the technical analysis provided, not guarantees.

A Little Context

Just remember, Endava is a technology company providing software and digital services. Its performance is tied to how much businesses are spending on tech projects. While the recent price action has been tough, the underlying business is still growing revenue. However, those fundamental points about profitability metrics and debt are definitely things to keep an eye on for the longer term.

Disclaimer: This analysis is based solely on the provided data and is for informational purposes only. It is not financial advice. Stock investing involves risk, and you could lose money. Always conduct your own thorough research and consider consulting with a qualified financial advisor before making any investment decisions.