TD Cowen analyst Brendan Smith maintained a Buy rating on Certara yesterday and set a price target of $16.00.
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Brendan Smith has given his Buy rating due to a combination of factors that highlight Certara’s strong performance and potential for growth. The company reported a 12% year-over-year increase in Q2 revenues, meeting management’s expectations and alleviating investor concerns about industry-wide challenges. Notably, Certara’s software revenue grew by 22%, driven by the success of its Simcyp software and the acquisition of Chemaxon, which contributed positively to the company’s financial results.
Furthermore, Certara’s services segment, which constitutes a significant portion of its revenue, also experienced growth. Despite some challenges in regulatory services, the company is actively exploring divestiture options to streamline operations. The strong Q2 bookings, with a 13% year-over-year increase, underscore Certara’s resilience in a challenging market environment. The company’s strategic positioning, particularly in light of the FDA’s shift towards computational platforms, suggests potential for further adoption and valuation upside, reinforcing Smith’s positive outlook.
In another report released on July 26, TR | OpenAI – 4o also reiterated a Buy rating on the stock with a $12.50 price target.