November 14, 2024
Top 10 Stock Simulations Plus Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Simulations Plus – Top 10 Stock in SDG 5: Gender Equality
Simulations Plus is listed as a top 10 stock on November 14, 2024 in the market index SDG 5 because of its high performance in at least one of the Obermatt investment strategies. Three consolidated Obermatt Ranks are above-average. Only the Value Rank is below average. The investment rationale may be an investment in future growth, supported by professional market opinion. Based on the Obermatt 360° View of 55 (high 55% performer), Obermatt assesses an overall buy recommendation for Simulations Plus on November 14, 2024.
Snapshot: Obermatt Ranks
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Simulations Plus Buy
| 360 METRICS | November 14, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 46 |
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| GROWTH | ||||||||
| GROWTH | 78 |
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| SAFETY | ||||||||
| SAFETY | 63 |
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| SENTIMENT | ||||||||
| SENTIMENT | 98 |
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| 360° VIEW | ||||||||
| 360° VIEW | 55 |
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ANALYSIS: With an Obermatt 360° View of 55 (better than 55% compared with alternatives), overall professional sentiment and financial characteristics for the stock Simulations Plus are above average. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Simulations Plus. The consolidated Growth Rank has a good rank of 78, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. This means that growth is higher than for 78% of competitors in the same industry. The consolidated Safety Rank at 63 means that the company has a financing structure that is safer than 63% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 98, which means that professional investors are more optimistic about the stock than for 98% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 46, meaning that the share price of Simulations Plus is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 54% of alternative stocks in the same industry. ...read more
RECOMMENDATION: With a consolidated 360° View of 55, Simulations Plus is better positioned than 55% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 78), a safe financing structure (Safety Rank of 63), and positive professional market sentiment (Sentiment Rank of 98), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Simulations Plus compared with alternatives? You can use the following rule of thumb: The growth rank measures the growth momentum of the company (78% better than peers). The value rank could be the reverse reflection of that (22%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just reflects the past, sometimes the reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Simulations Plus very positive
ANALYSIS: With an Obermatt Sentiment Rank of 98 (better than 98% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Simulations Plus is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Simulations Plus. Analyst Opinions are at a rank of 95 (better than 95% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 84, which means that currently, stock research experts are getting even more optimistic. Obermatt Market Pulse further supports this with a rank of 100, which means that the current professional news and professional social networks are generally positive when discussing this company (more positive news than for 100% of competitors). But there are few stock holdings by institutional investors. The Professional Investors rank is low at 36, which means that currently, professional investors hold less stock in this company than in 64% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 98 (more positive than 98% compared with investment alternatives), Simulations Plus has a reputation among professional investors that is significantly higher than that of its competitors. Not having too many professionals invested in Simulations Plus may be less of an issue, especially if the stock is from a smaller company where professionals typically invest less. It is natural for professional investors to focus on large and extra-large companies, as they provide more safety. Smaller companies attract fewer professionals in the shareholder community. Overall, the signals from the professionals are still quite favorable for investments in Simulations Plus. ...read more
Value Strategy: Simulations Plus Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 46 (worse than 54% compared with alternatives), Simulations Plus shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Simulations Plus. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 86% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 46 which means that the stock price compared with what market professionals expect for future profits is higher than 54% of comparable companies, indicating a low value concerning Simulations Plus's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 40 which means that the stock price compared with what market professionals expect for future profit levels is higher than 60% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 9 is also low. Compared with invested capital, the stock price is higher than for 91% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 46, is a hold recommendation based on Simulations Plus's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Simulations Plus? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Simulations Plus only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: Simulations Plus Growth Momentum high
| GROWTH METRICS | November 14, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 60 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 86 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 88 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 24 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 78 |
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ANALYSIS: With an Obermatt Growth Rank of 78 (better than 78% compared with alternatives) for 2024, Simulations Plus shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Simulations Plus. Sales Growth has a value of 60 which means that currently professionals expect the company to grow more than 60% of its competitors. Profit Growth with a value of 86 and Capital Growth with a rank of 88 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 24, which means that stock returns have recently been below 76% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 78, is a buy recommendation for growth and momentum investors. Simulations Plus has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for Simulations Plus, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. ...read more
Safety Strategy: Simulations Plus Debt Financing Safety above-average
| SAFETY METRICS | November 14, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 100 |
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| REFINANCING | ||||||||
| REFINANCING | 47 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 1 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 63 |
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ANALYSIS: With an Obermatt Safety Rank of 63 (better than 63% compared with alternatives), the company Simulations Plus has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Simulations Plus is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Simulations Plus and the other two below average. Leverage is at a rank of 100 meaning the company has a below-average debt-to-equity ratio. It has less debt than 100% of its competitors.Refinancing is at a rank of 47, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 53% of its competitors. Liquidity is at a rank of 1, meaning that the company generates less profit to service its debt than 99% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 63 (better than 63% compared with alternatives), Simulations Plus has a financing structure that is safer than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of Simulations Plus are on the safer side. ...read more
Combined financial peformance: Simulations Plus Above-Average Financial Performance
| COMBINED PERFORMANCE | November 14, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 46 |
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| GROWTH | ||||||||
| GROWTH | 78 |
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| SAFETY | ||||||||
| SAFETY | 1 |
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| COMBINED | ||||||||
| COMBINED | 55 |
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ANALYSIS: With an Obermatt Combined Rank of 55 (better than 55% compared with investment alternatives), Simulations Plus (Health Care Technology, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Simulations Plus are low in value (priced high) with a consolidated Value Rank of 46 (worse than 54% of alternatives). But they show above-average growth (Growth Rank of 78) and are safely financed (Safety Rank of 63, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 55, is a buy recommendation based on Simulations Plus's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Simulations Plus exhibits low value (Obermatt Value Rank of 46), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 78). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 63) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
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