Analyst Brendan Smith from TD Cowen maintained a Buy rating on Certara and keeping the price target at $16.00.
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Brendan Smith has given his Buy rating due to a combination of factors that highlight Certara’s strong market position and future growth potential. The company’s third-quarter revenues of $104.6 million, which represent a 10% year-over-year increase, align with expectations and demonstrate robust demand for its core software products. Notably, Certara’s software segment showed significant growth, with revenues increasing by 22% year-over-year, driven by the strength of products like Simcyp and contributions from Chemaxon.
Despite some challenges in the services segment, particularly in regulatory services, the overall growth in biosimulation services supports a positive outlook. Management’s focus on next-generation AI and cloud offerings is expected to further enhance adoption rates, positioning Certara well for future expansion. The company’s ability to maintain a high retention rate of 104% and the anticipated benefits from new product launches suggest a promising trajectory, justifying the Buy rating.
Smith covers the Healthcare sector, focusing on stocks such as Codexis, Repligen, and Twist Bioscience. According to TipRanks, Smith has an average return of 12.5% and a 57.14% success rate on recommended stocks.