Veritone (VERI) Valuation in Focus After Major Analyst Upgrade and Progress in Government AI Contracts

If you have been watching Veritone (VERI) lately, the latest surge in attention is easy to understand. D. Boral Capital just delivered a substantial analyst upgrade, spotlighting the company’s Data Refinery business and its ongoing pivot toward government and law enforcement contracts. The buzz grew after Veritone highlighted new projects and a much larger pipeline at a recent investment conference, sparking some big questions about what’s ahead for shareholders.

This comes after a year marked by momentum shifts for Veritone. The stock has climbed over 20% in the past year, shaking off longer-term negative returns, while recent weeks brought an impressive stretch of gains. Shares gained nearly 23% in just the past week and surged almost 1.5 times over the past three months. With new government initiatives and strategic pivots into high-demand AI markets, optimism appears to be gradually building, even as investors remain alert to risks and the company’s history of share price volatility.

Now, with attention turning to the company’s valuation after these latest upgrades and announcements, is Veritone trading at a discount, or is the market already banking on its next growth chapter?

Most Popular Narrative: 30.7% Undervalued

According to the most widely followed narrative, Veritone is considered undervalued, with a fair value estimate that sits well above its current share price. This view reflects analysts’ expectations for strong future growth and improving fundamentals, despite ongoing unprofitability.

Recent and expanding long-term contracts with government and defense entities, including sole-source contracts with the U.S. Air Force and other major law enforcement agencies, position Veritone to benefit from the structural increase in AI spending and regulatory pushes within public sector and compliance-driven markets. These multi-year deals support sustained revenue growth and increased gross margin leverage as the deployments scale.

Want to know what’s fueling this bullish perspective? There is a formula at the heart of this narrative, packed with big growth forecasts and profit assumptions that may surprise you. Hidden behind the headlines are bold projections that most investors will want to see for themselves.

Result: Fair Value of $5.25 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent quarterly losses and declining gross margins could quickly dampen this optimistic outlook if Veritone fails to deliver sustainable profitability soon.

Find out about the key risks to this Veritone narrative.

Another View: Putting the DCF Model to the Test

While analyst targets suggest upside, our DCF model lacks enough data for a fair value estimate at this time, which creates some uncertainty. Could this missing piece mean the market knows something the models do not?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Veritone for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Veritone Narrative

If you see things differently, or prefer to dive into the numbers yourself, you can build your own take on Veritone’s story in just a few minutes. Do it your way.

A great starting point for your Veritone research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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