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Certara
(NASDAQ:CERT)
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Rating:67Neutral
Price Target:
$9.00
▲(19.84% Upside)
Action:Reiterated
Date:08/04/26
The score is driven primarily by solid balance-sheet strength and consistently positive free cash flow, supporting financial stability. Technicals are also supportive with a clear uptrend, though momentum is near overbought. Offsetting these positives are weak valuation signals tied to ongoing losses (negative P/E) and an earnings outlook calling for only 0%–4% revenue growth with slightly reduced margin guidance and continued execution risk in services.
Positive Factors
Conservative balance sheet and low leverage
Certara’s conservative capital structure — low debt relative to equity and a large equity base — provides durable financial flexibility. That balance-sheet strength supports R&D investment, targeted M&A, buybacks and the ability to absorb cyclical weak patches in revenue without forcing dilutive financing or drastic cuts to core product development.
Negative Factors
Revenue growth weakness and recent contraction
A recent TTM revenue decline and modest full-year guidance signal limited top-line momentum, constraining structural growth prospects. With growth under pressure, margin improvement and shareholder returns become more dependent on cost reductions and successful software conversion rather than broad market expansion, raising execution sensitivity over the next several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative balance sheet and low leverage
Certara’s conservative capital structure — low debt relative to equity and a large equity base — provides durable financial flexibility. That balance-sheet strength supports R&D investment, targeted M&A, buybacks and the ability to absorb cyclical weak patches in revenue without forcing dilutive financing or drastic cuts to core product development.
Read all positive factors
Certara Key Performance Indicators (KPIs)
Any
Revenue by Type
Analyzes revenue streams from different business segments, highlighting which areas are driving growth and which may need strategic adjustments.
Analyzes revenue streams from different business segments, highlighting which areas are driving growth and which may need strategic adjustments.
Data provided by:
The Fly
The FlyCertara (CERT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.26B
Dividend YieldN/A
Average Volume (3M)4.23M
Price to Earnings (P/E)―
Beta (1Y)1.73
Revenue Growth6.40%
EPS Growth-477.58%
CountryUS
Employees1,546
SectorHealthcare
Sector Strength45
IndustryMedical - Healthcare Information Services
Share Statistics
EPS (TTM)-0.44
Shares Outstanding155,564,600
10 Day Avg. Volume2,918,906
30 Day Avg. Volume4,230,726
Financial Highlights & Ratios
PEG Ratio10.16
Price to Book (P/B)1.33
Price to Sales (P/S)3.37
P/FCF Ratio20.25
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$8.21Price Target Upside9.38% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)0.35
Revenue Forecast (FY)$385.63M
Certara Business Overview & Revenue Model
Company Description
Certara, Inc. provides advanced software solutions and technology-driven services, specializing in biosimulation throughout the entire drug development lifecycle. From initial drug discovery and preclinical research to clinical trials, regulatory ...
How the Company Makes Money
Certara generates revenue primarily through a mix of software and services. A major portion comes from licensing and subscriptions to its drug development and biosimulation software platforms (typically sold via term-based licenses and/or recurrin...
Certara Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 11, 2026
Earnings Call Sentiment Neutral
The call presented a balanced picture: clear, measurable momentum in software, AI integration and product/scientific leadership (strong bookings growth in software, pipeline expansion, cloud wins, regulatory engagement and scientific publications), alongside near-term financial and operational headwinds (service revenue declines, modest overall revenue growth, margin impact from divestiture-related stranded costs, and a GAAP net loss). Management has taken decisive operational actions (RIF, product reprioritization, new CCO, $13M run-rate savings) and is bullish on mid-term growth, but execution risk remains in converting a larger services pipeline and realizing cost savings. On balance the results are cautiously constructive but not yet a decisive turnaround in overall financial performance.Positive Updates
Modest Top-Line Growth with Software Momentum
Total revenue for Q2 2026 was $93.3M, up 1% year-over-year. Software revenue grew 4% to $48.8M and now represents 53% of the business (versus 40% two years ago). Software bookings for the quarter increased 9% to $50.7M and trailing 12-month software bookings rose 8% to $196.4M.
Negative Updates
Services Revenue and Bookings Decline
Services revenue declined 3% YoY in Q2 to $44.5M; services bookings fell 6% YoY to $47.6M and trailing 12-month services bookings declined 1% to $209M. Management noted services bookings lagged in the quarter and require go-to-market changes.
Read all updates
Q2-2026 Updates
Positive
Negative
Modest Top-Line Growth with Software Momentum
Total revenue for Q2 2026 was $93.3M, up 1% year-over-year. Software revenue grew 4% to $48.8M and now represents 53% of the business (versus 40% two years ago). Software bookings for the quarter increased 9% to $50.7M and trailing 12-month software bookings rose 8% to $196.4M.
Read all positive updates
Company Guidance
Certara reaffirmed full‑year 2026 revenue guidance of 0%–4% growth, which management says equates to $367M–$382M on a continuing‑operations basis, with software expected to be at or above the high end of that range and services at or below the low end; full‑year adjusted EBITDA margin is guided to 29%–31% (revised from 30%–32%), adjusted diluted EPS from continuing operations is $0.31–$0.36, fully diluted shares 155M–157M and an effective tax rate of ~30%. The company is targeting roughly $13M of run‑rate cost savings (after a RIF affecting ~5% of employees), finished Q2 with $184.1M cash, $294M term‑loan borrowings and $100M revolver availability, completed a $100M repurchase program (Q2 repurchases $17.4M) and has a new $50M buyback authorization, and noted the May divestiture of the regulatory/medical‑writing business (which contributed $19.2M revenue and ~$7.5M adjusted EBITDA through May and roughly $17M adjusted EBITDA in 2025) as the primary driver of the change in margin guidance.Certara Financial Statement Overview
Summary
Income Statement
54
Neutral
Balance Sheet
74
Positive
Cash Flow
78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 408.45M | 418.84M | 385.15M | 354.34M | 335.64M | 286.10M |
| Gross Profit | 238.24M | 257.71M | 230.63M | 213.31M | 203.07M | 174.49M |
| EBITDA | 83.28M | 83.91M | 72.37M | 23.84M | 89.00M | 58.58M |
| Net Income | -68.40M | -1.59M | -12.05M | -55.36M | 14.73M | -13.27M |
Balance Sheet | ||||||
| Total Assets | 1.40B | 1.56B | 1.58B | 1.56B | 1.57B | 1.51B |
| Cash, Cash Equivalents and Short-Term Investments | 184.14M | 189.39M | 179.18M | 234.95M | 236.59M | 185.80M |
| Total Debt | 291.84M | 11.40M | 311.90M | 302.57M | 308.13M | 308.38M |
| Total Liabilities | 433.28M | 493.79M | 516.45M | 516.30M | 493.26M | 469.88M |
| Stockholders Equity | 966.51M | 1.06B | 1.06B | 1.05B | 1.08B | 1.04B |
Cash Flow | ||||||
| Free Cash Flow | 61.64M | 69.77M | 59.42M | 67.43M | 80.01M | 51.49M |
| Operating Cash Flow | 82.86M | 96.33M | 80.47M | 82.75M | 92.54M | 60.39M |
| Investing Cash Flow | 41.14M | -26.56M | -112.37M | -79.55M | -27.84M | -269.92M |
| Financing Cash Flow | -101.63M | -63.99M | -21.01M | -9.45M | -7.36M | 123.39M |
Certara Technical Analysis
Positive
7.51
Price Trends
6.43
Positive
6.12
Positive
7.51
Positive
Market Momentum
0.47
Negative
64.16
Neutral
80.17
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CERT, the sentiment is Positive. The current price of 7.51 is above the 20-day moving average (MA) of 7.36, above the 50-day MA of 6.43, and below the 200-day MA of 7.51, indicating a bullish trend. The MACD of 0.47 indicates Negative momentum. The RSI at 64.16 is Neutral, neither overbought nor oversold. The STOCH value of 80.17 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CERT.
Certara Risk Analysis
Certara disclosed 43 risk factors in its most recent earnings report. Certara reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Certara Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $1.26B | -84.73 | -2.17% | ― | 6.40% | -477.58% | |
63 Neutral | $1.61B | 41.37 | 3.13% | ― | 8.45% | 72.08% | |
56 Neutral | $475.69M | -4.81 | -140.63% | ― | 20.85% | -18.60% | |
55 Neutral | $1.13B | -10.74 | -30.85% | ― | 10.59% | 46.79% | |
52 Neutral | $154.44M | -0.56 | -99.78% | ― | -2.83% | -223.32% | |
52 Neutral | $98.08M | -0.42 | -67.07% | ― | -3.89% | 63.03% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
CERT
Certara
8.01
-1.52
-15.95%
OMCL
Omnicell
37.17
6.08
19.56%
HCAT
Health Catalyst
2.39
-1.43
-37.43%
SDGR
Schrodinger
16.40
-2.94
-15.20%
SOPH
SOPHiA GENETICS
6.30
3.15
100.00%
DH
Definitive Healthcare Corp
0.67
-3.26
-83.03%
Certara Corporate Events
Business Operations and StrategyExecutive/Board Changes
Certara Announces Leadership Change in Commercial Executive Role
Neutral
Aug 4, 2026
On August 4, 2026, Certara, Inc. reported that Leif E. Pedersen had departed from his position as President and Chief Commercial Officer, effective August 1, 2026. The leadership change affects a key commercial executive role at the company, with ...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Certara Appoints Interim CFO Amid Leadership Transition
Neutral
Jun 17, 2026
On June 11, 2026, Certara’s Chief Financial Officer John E. Gallagher III tendered his resignation, effective July 14, 2026, to pursue another opportunity, with the company emphasizing that his departure was not due to any disagreement over ...
Executive/Board ChangesShareholder Meetings
Certara Shareholders Back Directors, Auditor and Executive Pay
Positive
May 15, 2026
On May 14, 2026, Certara, Inc. held its annual meeting of stockholders, where investors elected three Class III directors—Arjun Bedi, Stephen McLean and Jon Resnick—to serve on the board until the 2029 annual meeting and until their su...
Business Operations and StrategyFinancial DisclosuresM&A Transactions
Certara Divests Medical Writing Unit to Refocus Strategy
Neutral
May 11, 2026
Certara reported first‑quarter 2026 revenue of $106.9 million, up 1% year on year, with software revenue rising 7% to $49.7 million and services revenue falling 4% to $57.2 million, while higher operating expenses swung the company to a net ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.