Certara (NASDAQ:CERT) Issues Earnings Results, Misses Estimates By $0.01 EPS

Certara (NASDAQ:CERT) released its quarterly earnings data on Tuesday. The company reported $0.08 EPS for the quarter, missing analysts’ consensus estimates of $0.09 by ($0.01), FiscalAI reports. The business had revenue of $93.27 million during the quarter, compared to analyst estimates of $98.09 million. Certara had a negative net margin of 3.60% and a positive return on equity of 3.52%. The company’s revenue was down 10.8% on a year-over-year basis. During the same quarter in the prior year, the company posted $0.07 earnings per share.

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

• Second-quarter revenue grew 1% to $93.3 million, with software revenue up 4% and services revenue down 3%. Management reaffirmed full-year revenue growth guidance of 0%–4%, or $367 million–$382 million on a continuing-operations basis.
• Software bookings increased 9% in the quarter and trailing-12-month software bookings rose 8%, supported by Simcyp, Phoenix and Pinnacle 21. The company also reported a 27% year-over-year increase in pipeline and expects software revenue to reach at least the high end of its annual growth range.
• Certara is implementing a new commercial model, appointing Julien Perrier as Chief Commercial Officer and emphasizing specialist-led services sales. A May workforce reduction affecting about 5% of employees is expected to generate approximately $13 million in annualized savings, helping offset stranded costs from the divestiture and fund AI investment.
• Services bookings declined 6% in the second quarter, and management expects full-year services revenue to be at or below the low end of its 0%–4% growth range. Adjusted EBITDA margin guidance was reduced to 29%–31%, while the company posted a $6.1 million continuing-operations net loss versus $1.5 million of income in the prior-year quarter.
• The board authorized an additional $50 million share-repurchase program after Certara completed a prior $100 million authorization. Management also highlighted growing cloud adoption, AI-enabled product development and partnerships—including NVIDIA—as longer-term growth opportunities.

Certara Price Performance

Shares of NASDAQ CERT opened at $6.88 on Tuesday. The stock’s 50-day simple moving average is $6.36 and its 200-day simple moving average is $6.57. The firm has a market capitalization of $1.07 billion, a PE ratio of -69.17 and a beta of 1.44. Certara has a fifty-two week low of $4.45 and a fifty-two week high of $13.88. The company has a debt-to-equity ratio of 0.28, a quick ratio of 1.88 and a current ratio of 1.88.

Hedge Funds Weigh In On Certara

Hedge funds have recently added to or reduced their stakes in the stock. Northwestern Mutual Wealth Management Co. lifted its position in shares of Certara by 2,733.3% during the 4th quarter. Northwestern Mutual Wealth Management Co. now owns 2,975 shares of the company’s stock worth $26,000 after buying an additional 2,870 shares during the last quarter. Osaic Holdings Inc. boosted its holdings in shares of Certara by 50.7% in the 2nd quarter. Osaic Holdings Inc. now owns 3,491 shares of the company’s stock valued at $41,000 after buying an additional 1,175 shares in the last quarter. Tower Research Capital LLC TRC grew its position in shares of Certara by 499.5% in the 2nd quarter. Tower Research Capital LLC TRC now owns 5,917 shares of the company’s stock valued at $69,000 after buying an additional 4,930 shares during the last quarter. Canada Pension Plan Investment Board acquired a new stake in Certara during the 2nd quarter worth $83,000. Finally, Engineers Gate Manager LP acquired a new stake in Certara during the 4th quarter worth $92,000. 73.96% of the stock is currently owned by hedge funds and other institutional investors.

Analysts Set New Price Targets

CERT has been the subject of a number of research analyst reports. Stephens lowered their price target on Certara from $10.00 to $9.00 and set an “overweight” rating for the company in a report on Tuesday, May 12th. Barclays reduced their price objective on shares of Certara from $8.00 to $6.50 and set an “equal weight” rating on the stock in a report on Tuesday, May 12th. Morgan Stanley lowered their target price on shares of Certara from $11.00 to $10.00 and set an “equal weight” rating for the company in a research note on Tuesday, May 12th. Robert W. Baird reduced their price target on shares of Certara from $7.00 to $6.00 and set a “neutral” rating on the stock in a research note on Tuesday, May 12th. Finally, Craig Hallum decreased their price objective on shares of Certara from $10.00 to $8.00 and set a “hold” rating on the stock in a report on Tuesday, May 12th. One investment analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating, six have issued a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat.com, the stock has a consensus rating of “Hold” and an average price target of $8.85.

About Certara

Certara is a biosimulation software and services company that partners with pharmaceutical, biotechnology and medical device developers to accelerate drug discovery, development and regulatory approval. The company’s platform integrates quantitative pharmacology, real-world evidence, artificial intelligence and machine learning to model and simulate drug behavior across a range of therapeutic areas and patient populations. By applying these mechanistic and data-driven approaches, Certara helps its clients predict clinical outcomes, optimize dosing strategies and streamline decision-making throughout the product lifecycle.

The company’s offerings are divided into software tools and consulting services.