Endava (NYSE:DAVA) Posts Earnings Results, Misses Expectations By $0.20 EPS

Endava (NYSE:DAVA) announced its quarterly earnings results on Thursday. The company reported $0.07 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.27 by ($0.20), FiscalAI reports. The company had revenue of $236.44 million for the quarter, compared to analysts’ expectations of $242.79 million. Endava had a negative net margin of 57.01% and a positive return on equity of 2.14%. Endava updated its Q4 2026 guidance to 0.120-0.180 EPS and its FY 2026 guidance to 0.610-0.660 EPS.

Here are the key takeaways from Endava’s conference call:

• Q3 revenue missed expectations at £178.5 million, down 8.4% year over year, as pipeline conversion slowed and some work slipped beyond March.
• The company cut its Q4 and full-year FY2026 guidance, citing delayed Middle East projects, softer macro demand, and slower execution on large outcome-based contracts.
• Endava booked a £364.6 million non-cash goodwill impairment and a £23.2 million deferred tax asset write-off, driving a £372 million pre-tax loss for the quarter.
• Management said its AI-driven business grew to 15% of revenue from 5% a year ago, and 12 clients now use Dava.Flow versus 3 last quarter, supporting a higher-margin mix shift.
• The company highlighted new partnerships and wins, including Mastercard, Google Cloud, and NatWest’s Tyl, as evidence that clients are moving from AI pilots to production-grade, outcome-based programs.

Endava Stock Performance

DAVA opened at $3.34 on Friday. The company has a current ratio of 2.39, a quick ratio of 2.39 and a debt-to-equity ratio of 0.36. The company has a market cap of $187.46 million, a price-to-earnings ratio of -0.32 and a beta of 1.11. The company’s 50 day moving average is $4.33 and its 200 day moving average is $5.62. Endava has a 12-month low of $3.20 and a 12-month high of $17.36.

Key Headlines Impacting Endava

Here are the key news stories impacting Endava this week:

• Positive Sentiment: Needham & Company trimmed its price target but kept a buy rating, suggesting some analysts still see rebound potential for Endava despite the weak quarter.
• Neutral Sentiment: TD Cowen lowered its target to $4.00 and maintained a hold view, reflecting a more cautious but not outright bearish stance on the name.
• Neutral Sentiment: Morgan Stanley cut its target to $4.00 and kept an equal weight rating, indicating the firm sees limited near-term upside but not a dramatic deterioration beyond current expectations.
• Neutral Sentiment: JPMorgan reaffirmed an underweight rating while reducing its target, underscoring that sentiment on the stock remains subdued after the earnings update.
• Negative Sentiment: Endava reported fiscal Q3 EPS of $0.07 versus the $0.27 consensus and revenue of $236.4 million versus $242.8 million expected, then cut FY26 EPS and revenue guidance below estimates. Endava Announces Third Quarter Fiscal Year 2026 Results
• Negative Sentiment: Johnson Fistel said it is investigating potential securities-law violations tied to investor losses, adding a legal-overhang headline that may further weigh on shares. Endava plc Shareholders Are Encouraged to Reach Out to Johnson Fistel for More Information about Potentially Recovering Their Losses

Analyst Ratings Changes

DAVA has been the topic of a number of recent analyst reports. Wall Street Zen raised shares of Endava from a “sell” rating to a “hold” rating in a report on Sunday, February 8th. CLSA set a $5.00 price target on shares of Endava in a report on Friday. Needham & Company LLC dropped their price target on shares of Endava from $7.00 to $5.00 and set a “buy” rating on the stock in a report on Thursday. Zacks Research downgraded shares of Endava from a “hold” rating to a “strong sell” rating in a report on Thursday. Finally, Weiss Ratings reissued a “sell (d)” rating on shares of Endava in a report on Tuesday, April 7th. Two research analysts have rated the stock with a Buy rating, four have given a Hold rating and three have issued a Sell rating to the stock. According to MarketBeat, the stock has a consensus rating of “Reduce” and an average target price of $7.14.

Institutional Investors Weigh In On Endava

Institutional investors and hedge funds have recently added to or reduced their stakes in the company. Engineers Gate Manager LP raised its position in shares of Endava by 582.2% during the fourth quarter. Engineers Gate Manager LP now owns 69,335 shares of the company’s stock valued at $438,000 after buying an additional 59,171 shares during the last quarter. Woodline Partners LP bought a new stake in shares of Endava during the third quarter valued at approximately $275,000. Balyasny Asset Management L.P. bought a new stake in shares of Endava during the fourth quarter valued at approximately $268,000. Trexquant Investment LP bought a new stake in shares of Endava during the fourth quarter valued at approximately $250,000. Finally, Benjamin Edwards Inc. purchased a new position in shares of Endava in the second quarter valued at $198,000. Institutional investors own 62.23% of the company’s stock.

About Endava

Endava PLC is a publicly traded technology services company specializing in digital transformation and agile software development. The firm helps enterprise clients design, build and manage custom software solutions across industries such as financial services, payments, retail, telecommunications and media. Its service offerings span end-to-end product design, customer experience, application development, quality engineering, DevOps, automation and artificial intelligence, all delivered through agile methodologies.

Founded in 2000, Endava has grown from a small software provider into a global IT partner.