Simulations Plus price target lowered to $28 from $42 at Stephens

Stephens lowered the firm’s price target on Simulations Plus (SLP) to $28 from $42 and keeps an Overweight rating on the shares after the company negatively pre-announced preliminary fiscal Q3 revenue and decreased FY25 revenue guidance “materially.” The Q3 miss and guide-down were “mostly expected” following restructuring and leadership change announcements last week, but shares will be pressured given end-market commentary that cites more than delays, including budget reductions and project cancelations, the analyst tells investors. However, an expected return to 30%-plus EBITDA margins and an FDA supportive of biosimulation lead the firm to keep an Overweight rating on the shares, the analyst noted.