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Schrodinger
(NASDAQ:SDGR)
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Rating:55Neutral
Price Target:
$17.00
▲(13.56% Upside)
Action:Reiterated
Date:08/06/26
The score is held back primarily by weak financial quality (ongoing losses and negative TTM operating/free cash flow) despite strong top-line momentum and solid gross margins. Technicals are supportive with the stock trading above major moving averages and moderately positive momentum. Valuation lacks support due to negative earnings and no indicated dividend, while the earnings call was constructive (raised guidance and operational momentum) but tempered by hosted-transition headwinds and a more moderate full-year growth outlook.
Positive Factors
Recurring ACV growth and sales momentum
Sustained ACV expansion signals strengthening recurring revenue and deeper customer engagement. Larger ACV base improves revenue visibility, supports predictable renewals and upsells, and underpins long-term subscription economics even if quarter-to-quarter reported revenue fluctuates.
Negative Factors
Negative operating and free cash flow
Persistent negative OCF and FCF means the business is still consuming cash to run operations. Over months this can erode reserves or force financing if losses continue, limiting capital for growth initiatives and increasing execution risk until cash generation becomes consistently positive.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring ACV growth and sales momentum
Sustained ACV expansion signals strengthening recurring revenue and deeper customer engagement. Larger ACV base improves revenue visibility, supports predictable renewals and upsells, and underpins long-term subscription economics even if quarter-to-quarter reported revenue fluctuates.
Read all positive factors
Schrodinger Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down sales by region to identify where customers and growth are concentrated and to assess exposure to local regulatory, currency, and market cycles. Shifts across regions can signal new market penetration or rising risk from dependence on a particular geography or customer base.
Breaks down sales by region to identify where customers and growth are concentrated and to assess exposure to local regulatory, currency, and market cycles. Shifts across regions can signal new market penetration or rising risk from dependence on a particular geography or customer base.
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The Fly
The FlySchrodinger (SDGR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.13B
Dividend YieldN/A
Average Volume (3M)1.23M
Price to Earnings (P/E)―
Beta (1Y)1.74
Revenue Growth10.59%
EPS Growth46.79%
CountryUS
Employees850
SectorHealthcare
Sector Strength45
IndustrySoftware - Application
Share Statistics
EPS (TTM)-0.74
Shares Outstanding65,556,530
10 Day Avg. Volume895,288
30 Day Avg. Volume1,233,227
Financial Highlights & Ratios
PEG Ratio0.28
Price to Book (P/B)3.61
Price to Sales (P/S)5.13
P/FCF Ratio105.42
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
$20.25Price Target Upside35.27% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)-2
Revenue Forecast (FY)$234.72M
Schrodinger Business Overview & Revenue Model
Company Description
Schrödinger, Inc., together with its subsidiaries, develops physics-based computational platform that enables discovery of novel molecules for drug development and materials applications in the United States, the Asia-Pacific, Europe, Middle East,...
How the Company Makes Money
Schrödinger generates revenue primarily from (1) software offerings and (2) drug discovery-related activities. (1) Software revenue is driven by licensing Schrödinger’s computational platform and applications to customers (such as pharmaceutical, ...
Schrodinger Earnings Call Summary
Earnings Call Date:Aug 05, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 11, 2026
Earnings Call Sentiment Positive
The call conveyed strong operational momentum driven by robust ACV growth, accelerating hosted adoption, the early launch and customer deployment of Bunsen, notable one-time collaboration milestones (e.g., $10M Ajax milestone) and a return to quarterly profitability with a solid cash position. Counterbalancing this optimism are near-term margin and revenue recognition pressures from the accelerated hosted licensing transition, a decline in contribution revenue tied to grant timing, and multi-quarter adoption timelines for new products like predictive toxicology. Guidance shows moderate full-year ACV growth (10%–15%), reflecting a more conservative outlook than Q2’s run-rate. Overall, positives around product innovation, customer expansion, and financial position outweigh the transitional challenges while leaving some execution and timing risks to monitor.Positive Updates
Strong ACV Growth
Total ACV of $29.6M in Q2, up 27% year over year; ACV excluding contribution $22.6M, up 23% YoY; trailing four-quarter ACV reached $208M; first half 2026 ACV of $58.0M, up 19% vs H1 2025.
Negative Updates
Gross Margin Pressure from Hosted Transition
Software gross margin declined to 71% in Q2 from 76% in Q2 2025, reflecting the planned accelerated transition to hosted software licensing which shifts recognition to ratable revenue and reduces near-term reported margins.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong ACV Growth
Total ACV of $29.6M in Q2, up 27% year over year; ACV excluding contribution $22.6M, up 23% YoY; trailing four-quarter ACV reached $208M; first half 2026 ACV of $58.0M, up 19% vs H1 2025.
Read all positive updates
Company Guidance
The company reiterated full-year 2026 guidance with annual ACV expected to be $218 million to $228 million, representing 10%–15% growth over 2025 (Q4 typically accounts for >50% of annual ACV), and drug discovery revenue raised to $65 million–$75 million (up from prior $55M–$65M) driven by a $10 million Ajax milestone; Q3 2026 ACV excluding contribution is guided to $41M–$45M (vs. $38.3M in Q3 2025, which included $2.2M of contribution ACV). Management expects total operating expenses to be lower than 2025, continues to target 75% hosted revenue by end of 2028 (hosted was 47% of software revenue in Q2 2026), and warned that each 1 percentage-point increase in hosted revenue can reduce reported revenue by roughly $2M–$3M. Second-quarter operating metrics highlighted quarter ACV of $29.6M (27% YoY), ACV excluding contribution $22.6M (23% YoY), trailing four-quarter ACV of $208M, first-half ACV of $58.0M (19% YoY), contribution ACV of $7M in Q2 ($5M Gates, $2M Gates Ventures), and a strong balance sheet of $419M in cash and marketable securities with 75.8M fully diluted shares.Schrodinger Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
63
Positive
Cash Flow
38
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 259.04M | 255.87M | 207.54M | 216.67M | 180.96M | 137.93M |
| Gross Profit | 147.31M | 142.61M | 132.08M | 140.69M | 101.02M | 65.62M |
| EBITDA | -45.87M | -96.30M | -179.55M | 48.47M | -144.78M | -97.96M |
| Net Income | -54.34M | -103.27M | -187.12M | 40.72M | -149.19M | -100.39M |
Balance Sheet | ||||||
| Total Assets | 640.39M | 726.16M | 823.23M | 802.96M | 688.59M | 756.49M |
| Cash, Cash Equivalents and Short-Term Investments | 413.74M | 395.46M | 352.12M | 463.00M | 451.09M | 576.48M |
| Total Debt | 107.98M | 109.23M | 117.83M | 127.88M | 116.49M | 79.87M |
| Total Liabilities | 311.44M | 362.11M | 401.78M | 254.40M | 240.68M | 199.40M |
| Stockholders Equity | 328.96M | 364.05M | 421.44M | 548.56M | 447.89M | 557.07M |
Cash Flow | ||||||
| Free Cash Flow | -49.80M | 12.46M | -164.68M | -150.14M | -127.70M | -77.84M |
| Operating Cash Flow | -43.90M | 13.90M | -157.37M | -136.73M | -119.68M | -70.67M |
| Investing Cash Flow | 230.68M | 57.90M | 148.84M | 193.03M | 90.02M | -16.81M |
| Financing Cash Flow | 2.29M | 2.93M | 10.12M | 9.05M | 2.11M | 7.95M |
Schrodinger Technical Analysis
Positive
14.97
Price Trends
15.43
Positive
13.78
Positive
15.18
Positive
Market Momentum
0.03
Negative
61.10
Neutral
85.63
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SDGR, the sentiment is Positive. The current price of 14.97 is below the 20-day moving average (MA) of 15.59, below the 50-day MA of 15.43, and below the 200-day MA of 15.18, indicating a bullish trend. The MACD of 0.03 indicates Negative momentum. The RSI at 61.10 is Neutral, neither overbought nor oversold. The STOCH value of 85.63 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SDGR.
Schrodinger Risk Analysis
Schrodinger disclosed 87 risk factors in its most recent earnings report. Schrodinger reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Schrodinger 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% | |
65 Neutral | $6.00B | -278.06 | -2.86% | ― | 2.26% | 86.67% | |
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 | $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
SDGR
Schrodinger
17.81
-1.55
-8.01%
OMCL
Omnicell
36.16
5.13
16.53%
TXG
10x Genomics
45.60
32.80
256.25%
CERT
Certara
8.13
-3.13
-27.80%
SOPH
SOPHiA GENETICS
6.69
3.49
109.06%
DH
Definitive Healthcare Corp
0.69
-3.29
-82.75%
Schrodinger Corporate Events
Business Operations and StrategyFinancial DisclosuresM&A Transactions
Schrödinger Gains $57 Million From Ajax Acquisition Deal
Positive
Jun 29, 2026
Schrödinger, Inc. reported that, in connection with Eli Lilly and Company’s acquisition of Ajax Therapeutics, Inc., a venture it co-founded, it received an immediate cash payment of approximately $57 million. The deal structure also pro...
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Schrödinger Shareholders Expand Equity Plan, Elect Directors
Positive
Jun 23, 2026
At its 2026 Annual Meeting of Stockholders held on June 22, 2026, Schrödinger’s shareholders approved an amendment to the 2022 Equity Incentive Plan, increasing the number of common shares available for issuance by 3,000,000, which expa...
Executive/Board ChangesRegulatory Filings and Compliance
Schrödinger Finalizes Transition Terms for Former Commercial Chief
Neutral
Jun 8, 2026
On June 5, 2026, Schrödinger, Inc. entered into a transition, separation and release of claims agreement with former Chief Commercial Officer and Global Head of Software Sales and Marketing Mannix Aklian, formalizing the previously disclosed ...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Schrödinger Announces Leadership Change Amid Maintained 2026 Outlook
Neutral
May 20, 2026
On May 18, 2026, Schrödinger, Inc. announced that Mannix Aklian ceased serving as Chief Commercial Officer and Global Head of Software Sales and Marketing with immediate effect, marking a significant change in its commercial leadership. Forme...
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.