Simulations Plus (SLP) AI Stock Analysis

• Market Cap: $409.58M
• Dividend Yield: N/A
• Average Volume (3M): 302.13K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.08
• Revenue Growth: 13.09%
• EPS Growth: -745.95%
• Country: US
• Employees: 243
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Healthcare Information Services
• EPS (TTM): 0.03
• Shares Outstanding: 20,146,585
• 10 Day Avg. Volume: 430,268
• 30 Day Avg. Volume: 302,135
• PEG Ratio: <0.01
• Price to Book (P/B): 2.28
• Price to Sales (P/S): 3.60
• P/FCF Ratio: 16.36
• Enterprise Value/Market Cap: 0.77
• Enterprise Value/Revenue: 4.00
• Enterprise Value/Gross Profit: 6.72
• Enterprise Value/Ebitda: 21.53
• 1Y Price Target: $19.00
• Price Target Upside: -6.54% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): 1.02
• Revenue Forecast (FY): $80.36M

• Rating: 54 Neutral
• Price Target: $18.50 ▼(-9.00% Downside)

The score is held back primarily by very weak TTM profitability and a sharp revenue contraction, partially offset by strong balance sheet strength, positive free cash flow, and reaffirmed FY2026 guidance targeting healthy adjusted margins. Technical signals are neutral-to-soft and valuation is constrained by the current net-loss profile.

Positive Factors

Conservative balance sheet and minimal leverage

The company's extremely low leverage and strong capitalization provide durable financial flexibility to fund R&D, absorb operating volatility, pursue M&A, or withstand market cycles. This reduces refinancing risk and preserves operational optionality while profitability recovers.

Consistent positive operating and free cash flow

Solid TTM operating and free cash flow supports ongoing operations and strategic investments despite GAAP losses. Reliable cash generation cushions the business, funds cloud/AI initiatives, and increases resilience against revenue cyclicality or temporary demand softness.

Strategic product roadmap toward cloud and AI

Moving core products to cloud and integrating AI represents a structural shift that can boost scalability, recurring revenue, and customer stickiness. A cloud/AI-first roadmap aligns with secular pharma digitization, improving long-term TAM capture and competitive differentiation.

Negative Factors

Sharp TTM revenue decline and operating loss

A ~64% TTM revenue drop and very negative margins erode scale and operating leverage. Sustained top-line weakness reduces ability to fund innovation and sales, pressures margins long-term, and can weaken competitive position if customer demand does not stabilize.

Large noncash impairment and material GAAP loss

The $77.2M noncash impairment materially reduced equity and signals prior intangible/goodwill overhang. Even if noncash, it depresses reported returns, complicates comparability and could constrain strategic flexibility if further impairments or valuation resets are required.

Renewal-rate pressure from client consolidation

Declining renewal rates and consolidation-driven scrutiny threaten recurring-license predictability and lifetime customer value. Persistent renewal pressure forces higher sales effort or discounts, reduces revenue visibility, and can undermine long-term software-margin sustainability.

Simulations Plus Business Overview & Revenue Model

Company Description

Simulations Plus, Inc. develops drug discovery and development software for modeling and simulation, and prediction of molecular properties utilizing artificial intelligence and machine learning based technology worldwide. It operates through four segments: Simulations Plus, Cognigen, DILIsym, and Lixoft. The company offers GastroPlus, which simulates the absorption and drug interaction of compounds administered to humans and animals; and DDDPlus and MembranePlus simulation products. It also provides products based on mechanistic and mathematical models, such as DILIsym, a quantitative systems pharmacology software; NAFLDsym; IPFsym; RENAsym; and MITOsym. In addition, the company provides Absorption, Distribution, Metabolism, Excretion, and Toxicity Predictor for chemistry-based computer program that takes molecular structures as inputs and predicts their properties; and MedChem Designer, as well as modeling and simulation products comprising MonolixSuite and PKPlus. Further, it provides population modeling and simulation contract research services; training and consulting services designed to accelerate pharmacometrics studies; and clinical-pharmacology-based consulting services in support of regulatory submissions. The company serves pharmaceutical, biotechnology, agrochemical, cosmetics, and food companies, as well as academic and regulatory agencies. Simulations Plus, Inc. was incorporated in 1996 and is headquartered in Lancaster, California.

How the Company Makes Money

Simulations Plus generates revenue primarily through the sale of software licenses, maintenance contracts, and consulting services. The company offers its software products on a subscription basis, which provides a steady stream of recurring income. Additionally, SLP earns revenue from training programs and technical support services related to its software solutions. Partnerships with pharmaceutical and biotechnology companies enhance its market presence and contribute to its earnings, as these collaborations often lead to joint projects and increased software utilization. The company also benefits from a growing demand for computational modeling in drug development, which further drives its revenue growth.

Simulations Plus Financial Statement Overview

Summary

Fundamentals are mixed: the income statement is very weak in the TTM with a sharp revenue decline and deep losses, but the balance sheet is conservatively positioned with extremely low leverage and cash flow remains solid with positive free cash flow. The key risk is whether cash generation is sustainable if operating weakness persists.

Income Statement

Performance deteriorated sharply in TTM (Trailing-Twelve-Months): revenue fell ~64% versus the prior period and profitability swung to a deep loss (net margin about -82%, with negative operating and EBITDA margins). This is a major break from 2021–2024, when revenue grew steadily and the company produced healthy positive margins. Strength remains in historically strong gross margin (high-50%s in TTM), but the scale of the current operating loss and revenue contraction heavily outweighs that benefit.

Balance Sheet

The balance sheet is conservatively positioned with extremely low leverage (debt is well under 1% of equity; debt-to-equity ~0.005), providing financial flexibility. However, the current loss profile drives a deeply negative return on equity in TTM, and equity has declined meaningfully from the 2024 level, reflecting the impact of recent results. Overall: very strong capitalization, but profitability pressure is eroding returns.

Cash Flow

Cash generation remains a clear positive despite reported losses: TTM (Trailing-Twelve-Months) operating cash flow is ~$23.6M and free cash flow is ~$23.0M, with free cash flow up strongly versus the prior period. Cash flow is also more than enough to cover net losses (operating cash flow to net income is ~2.7x, and free cash flow is roughly in line with net income magnitude). The key risk is sustainability—cash flow strength alongside steep revenue declines and large accounting losses can be volatile if operating conditions don’t stabilize.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	79.18M	70.01M	59.58M	53.91M	46.47M
Gross Profit	46.22M	43.15M	47.95M	43.08M	35.87M
EBITDA	14.70M	11.80M	13.06M	18.69M	14.70M
Net Income	-64.72M	9.95M	9.96M	12.48M	9.78M
Balance Sheet
Total Assets	131.94M	207.64M	192.64M	190.50M	181.61M
Cash, Cash Equivalents and Short-Term Investments	32.35M	20.25M	115.46M	128.24M	123.60M
Total Debt	616.00K	1.01M	1.20M	1.40M	1.28M
Total Liabilities	7.13M	25.21M	22.61M	12.26M	15.83M
Stockholders Equity	124.80M	182.43M	170.03M	178.25M	165.78M
Cash Flow
Free Cash Flow	17.41M	12.75M	17.58M	13.93M	14.63M
Operating Cash Flow	18.13M	13.32M	21.86M	17.90M	19.20M
Investing Cash Flow	3.56M	-53.97M	7.37M	4.30M	-26.74M
Financing Cash Flow	-1.15M	-6.57M	-23.27M	-7.62M	-4.68M

Simulations Plus Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 20.33
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SLP, the sentiment is Positive. The current price of 20.33 is above the 20-day moving average (MA) of 19.06, above the 50-day MA of 18.47, and above the 200-day MA of 19.90, indicating a bullish trend. The MACD of 0.40 indicates Negative momentum. The RSI at 61.36 is Neutral, neither overbought nor oversold. The STOCH value of 94.11 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SLP.

Simulations Plus Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HSTM	69 Neutral	$647.06M	31.97	5.87%	0.52%	3.68%	5.62%
CERT	62 Neutral	$1.51B	141.10	1.03%	―	11.47%	―
OMDA	56 Neutral	$933.48M	-34.67	―	―	50.51%	50.92%
SLP	54 Neutral	$409.58M	-6.36	-41.21%	―	13.09%	-745.95%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
SOPH	51 Neutral	$369.77M	-4.88	-86.09%	―	13.66%	-2.65%
EVH	48 Neutral	$420.74M	-2.40	-13.63%	―	-16.65%	-71.92%

Simulations Plus Corporate Events

Simulations Plus Posts Mixed Q1 2026 Results, Reaffirms Outlook

On January 8, 2026, Simulations Plus reported fiscal first-quarter 2026 results for the period ended November 30, 2025, showing a 3% year-over-year decline in total revenue to $18.4 million, as a 17% drop in software revenue to $8.9 million was offset by a 16% increase in services revenue to $9.5 million, which for the quarter became the larger contributor to sales. Despite lower adjusted EBITDA and adjusted net income versus the prior year, the company improved gross margin to 59%, increased GAAP net income to $0.7 million, and met its revenue guidance, while management highlighted strong services performance, favorable client funding conditions, and solid bookings in both software and services as support for reaffirming full-year 2026 guidance, including projected revenue of $79 million to $82 million and an adjusted EBITDA margin of 26% to 30%.

The most recent analyst rating on (SLP) stock is a Hold with a $19.00 price target. To see the full list of analyst forecasts on Simulations Plus stock, see the SLP Stock Forecast page.

Simulations Plus Announces New Executive Appointments

The news release from Simulations Plus does not provide specific details about the company’s industry, primary products, or services. The release mentions information related to agreements and references certain items, but lacks substantive details about the company’s operations or market focus.

The most recent analyst rating on (SLP) stock is a Hold with a $20.50 price target. To see the full list of analyst forecasts on Simulations Plus stock, see the SLP Stock Forecast page.

Simulations Plus Reports Q4 2025 Financial Results

On December 1, 2025, Simulations Plus reported its financial results for the fourth quarter and fiscal year ending August 31, 2025. The company experienced a 6% decrease in total revenue for the fourth quarter compared to the previous year, with a net loss of $0.7 million. However, for the full year, total revenue increased by 13% to $79.2 million. Despite a challenging demand environment, the company remains optimistic about its future, reaffirming its fiscal 2026 revenue guidance and emphasizing its focus on AI-driven workflows and cloud deployment to enhance its product offerings.

The most recent analyst rating on (SLP) stock is a Hold with a $16.00 price target. To see the full list of analyst forecasts on Simulations Plus stock, see the SLP Stock Forecast page.

Simulations Plus Announces Fiscal 2025 Results and 2026 Guidance

On October 22, 2025, Simulations Plus announced its preliminary fiscal year 2025 results and issued guidance for fiscal year 2026. The company reported a revenue of $79.1 million for fiscal 2025, with a 13% growth, and provided a revenue guidance of $79 to $82 million for fiscal 2026. Despite challenging market conditions, the company expects to meet its revised fiscal 2025 guidance. They also unveiled a new product vision to enhance software delivery and AI capabilities, marking the launch of GastroPlus® X.2 on the S+ Cloud as a significant step in their cloud and AI strategy.

The most recent analyst rating on (SLP) stock is a Hold with a $16.00 price target. To see the full list of analyst forecasts on Simulations Plus stock, see the SLP Stock Forecast page.