Simulations Plus (SLP) to Report Q3 Earnings: What's in Store?
Simulations Plus SLP is slated to release third-quarter fiscal 2023 results on Jul 6.
The Zacks Consensus Estimate for third-quarter revenues is pegged at $16.1 million, which suggests growth of 7.6% from the year-ago quarter’s reported figure.
The consensus mark for earnings is pegged at 21 cents per share, indicating a year-over-year increase of 5%.
The company reported second-quarter fiscal 2023 earnings of 20 cents per share, down 4.8% on a year-over-year basis. However, the figure beat the Zacks Consensus Estimate by 11%. Revenues of $15.8 million increased 6% year over year (up 8% on constant-currency basis), driven by higher revenues in Software and Services business segments. Nonetheless, the top line missed the Zacks Consensus Estimate by 2.5%.
Simulations Plus, Inc. Price and EPS Surprise
Simulations Plus, Inc. price-eps-surprise | Simulations Plus, Inc. Quote
Factors to Note
The heathy demand for Simulations Plus’ modeling and simulation solutions is likely to boost software sales in the third quarter. Also, the company expects changes in renewal pattern and revenue seasonality to shift as anticipated. Frequent strategic collaborations for new AI/ML drug discovery bode well.
SLP’s implementation of cross-selling strategies has seen success with a growing client base using multiple platforms. In the last reported quarter, it added 6 new customers and 6 upsells for GastroPlus offering. For Monolix, it added 5 new customers with 6 upsells.
The company has also standardized its renewal, pricing, and discounting policies to make it simpler for clients to buy multiple offerings. This is likely to favor the top-line performance in the to-be-reported quarter.
Management plans to expand its global footprint by increasing its presence in Europe, Asia and Latin America, and penetrating smaller biotech firms with its software solutions like PBPK and PKPD services.
Higher costs on product enhancements, acquisitions, and research and development are likely to have exerted pressure on margin expansion in the quarter under review. Weakness in macro environment, increasing interest rates and forex volatility remain added concerns. Owing to weakness in macroeconomic environment, drug developers are deferring purchases and elongating the sales cycle.
What the Zacks Model Unveils
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Simulations Plus has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some stocks, which have the right combination of elements to post an earnings beat this time around.
AngioDynamics, Inc ANGO has an Earnings ESP of +20.00% and currently carries a Zacks Rank #3. ANGO is scheduled to report fourth-quarter fiscal 2023 earnings on Jul 12. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for AngioDynamics’ to-be-reported quarter’s earnings is pegged at 3 cents per share. Shares of ANGO have lost 46.6% in the past year.
Kura Sushi USA, Inc KRUS has an Earnings ESP of +40.00% and currently has a Zacks Rank #3. KRUS is scheduled to report third quarter fiscal 2023 earnings on Jul 6.
The Zacks Consensus Estimate for Kura Sushi USA’s to-be-reported quarter’s earnings and revenues is pegged at 5 cents per share and $49.2 million, respectively. The company’s earnings have delivered an average surprise of 123.5% in the trailing four quarters. Shares of KRUS have gained 84.6% in the past year.
Volkswagen AG VWAGY has an Earnings ESP of +6.51% and a Zacks Rank #2 at present. It is scheduled to report results for the first half 2023 on Jul 27. Shares of VWAGY have lost 8.3% in the past year.
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AngioDynamics, Inc. (ANGO) : Free Stock Analysis Report
Simulations Plus, Inc. (SLP) : Free Stock Analysis Report
Volkswagen AG Unsponsored ADR (VWAGY) : Free Stock Analysis Report
Kura Sushi USA, Inc. (KRUS) : Free Stock Analysis Report
