Certara (NASDAQ:CERT) has been downgraded from a “buy” to a “hold” rating by analysts at Wall Street Zen in a report released on November 6, 2023. This move reflects a broader trend as multiple financial institutions reassess their positions on the company’s stock.
In recent evaluations, Morgan Stanley lowered its price target for Certara from $16.00 to $12.00, maintaining an “equal weight” rating. Similarly, BMO Capital Markets initiated coverage on Certara with a “market perform” rating and set a price target of $9.00 on November 13. The company has also seen a reduction in price targets from Stephens and Barclays, with Stephens adjusting its target from $15.00 to $12.00 and Barclays from $14.00 to $13.00 while both retained “overweight” ratings.
Currently, Certara holds a consensus rating of “Moderate Buy” based on data from MarketBeat, with an average price target of $12.58. Notably, the stock has received two “Strong Buy” ratings, eight “Buy” ratings, six “Hold” ratings, and one “Sell” rating from various analysts.
Recent Financial Performance
Certara recently reported its earnings for the quarter ending November 6, announcing earnings per share (EPS) of $0.14, surpassing analysts’ expectations of $0.11 by $0.03. The company achieved a revenue of $104.62 million, slightly above the anticipated $104.53 million. Compared to the same quarter last year, Certara’s EPS rose from $0.13.
For the fiscal year 2025, Certara has set an EPS guidance between $0.450 and $0.470. Analysts forecast an EPS of $0.28 for the current year, indicating cautious optimism for the company’s financial trajectory.
Institutional Investments in Certara
A significant percentage of Certara’s shares are held by institutional investors and hedge funds. Notably, Wasatch Advisors LP increased its stake by 28.6% during the third quarter, now owning 17,398,337 shares valued at approximately $212.6 million. Other institutions, such as Dimensional Fund Advisors LP and Deerfield Management Company L.P., have also raised their investments, reflecting a growing interest in the company despite the recent downgrades.
Currently, institutional investors hold approximately 73.96% of Certara’s outstanding shares, indicating strong institutional support. This backing may provide a degree of stability as market perceptions shift.
Certara, known for its biosimulation software and services, collaborates with pharmaceutical, biotechnology, and medical device companies to expedite drug discovery and regulatory approval processes. Its platform employs quantitative pharmacology, real-world evidence, artificial intelligence, and machine learning to model drug behavior across various therapeutic areas.
As the market evolves, stakeholders will be closely monitoring both analyst ratings and the company’s financial performance to gauge Certara’s future potential.
