Endava PLC (DAVA US) Buy: The uphill climb to restore investor confidence got steeper

研报英文原文证据摘录

Endava PLC (DAVA US) Buy: The uphill climb to restore investor confidence got steeper

21 May 2026

Endava PLC (DAVA US) EquitiesIT Services

Buy: The uphill climb to restore investor confidence

got steeper United Kingdom

◆ Disappointing FY guidance on macro and slower revenue MAINTAIN BUY

conversion derails growth recovery expectations in FY26

TARGET PRICE (USD) PREVIOUS TARGET (USD)

◆ A significant part of FY26 guidance weakness appears

10.00 14.00 timing-related; we expect a more stabilized FY27

◆ Retain Buy, lower TP to USD10.00 (from USD14.00). SHARE PRICE (USD) UPSIDE/DOWNSIDE

Consistent Q/Q revenue growth on better execution looks key 3.34 +199.4%

(as of 21 May 2026)

3QFY26 is a setback after encouraging growth recovery signs in 2QFY26: Endava MARKET DATA

reported weaker than expected 3QFY26 results and issued disappointing FY26 guidance. Market cap (USDm) 136 Free float 78%

Market cap (USDm) 136 BBG DAVA US

3Q revenues were 3% below consensus, while adj. EPS missed consensus by 75% due 3m ADTV (USDm) 1 RIC DAVA.N

to low adj. net income margins (1.5% in 3QFY26) as Endava continues to invest heavily

despite weakening revenue. More importantly, 4QFY26 guidance implies a revenue decline FINANCIALS AND RATIOS (GBPp)

Year to 06/2025a 06/2026e 06/2027e 06/2028e

of USD14m at the mid-point as the company attributed the decline to lower revenues due HSBC EPS 113.14 45.31 52.05 88.44

to the Middle East conflict and the longer time taken to convert the large deals. Endava HSBC EPS (prev) 113.14 80.44 82.89 109.51

Change (%) 0.0 -43.7 -37.2 -19.2

lowered its constant currency FY26 revenue growth guidance by 2.5ppts-3ppts to -5% to Consensus EPS 111.71 81.17 97.94 114.19

-6%. Weaker revenues and high operating leverage led to a 43% lower FY26 adj. EPS PE (x) 2.2 5.5 4.8 2.8