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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Simulations Plus, Inc. (XNAS:SLP) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
SLP
Name:
SIMULATIONS PLUS, INC. (XNAS:SLP)
Sector:
2.18M
Industry:
Health Information Services
CEO:
Mr. Shawn O'Connor
Total Employees:
135
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -84.41% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF SIMULATIONS PLUS, INC.(SLP) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND HEALTH INFORMATION SERVICES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
57.21
One Month Price Target:
$57.35
Six Month Price Target :
$58.07
Likely Price in One Year's Time:
Ticker:
$58.93
Likely Trading Range Today Under (Normal Volatility)
$56.97
Price Upper limit ($) :
$57.61
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$53.37
This week:
$48.62
This month :
$40.02
Other Primary facts
Market Cap:
1.16B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
20.24M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
22.61%
-17.55%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$75.03
$66.75
$39.39
$47.67
Medium risk (<10%) entry points
Buy Call
Sell Call
$64.05
Buy Put:
Sell Put:
$62.29
$50.34
$52.13
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
SLP
Sharpe Ratio:
3.90%
Comparison:
SLP, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 279.87% higher than the industry
& ratio is 71.18% higher than the market/S&P 500 average
Average Returns/Yield of
SLP
Daily returns:
0.14%
Weekly returns:
0.70%
Monthly returns:
2.78%
Yearly returns:
5.07%
Comparison of returns:
Average annual returns/yield (last 3 years) is 557.94% above industry average
Classification:
SLP, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.37
Statistical test of Returns:
SLP has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.34%
Weekly Volatility:
7.46%
Monthly Volatility:
14.93%
Yearly Volatility:
51.72%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.89%
Volatility in last five trading days has been -73.44% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.72%
Weekly VaR:
-15.02%
Monthly VaR:
-30.04%
How Much Can the price of
SLP
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-25%
Worst case (decline):
>85%
This translates to price declining to:
$42.93
This translates to price declining to:
$8.58
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
SLP is a 112.02% riskier investment compared to the market/S&P 500 & is 81.63% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -1.85% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
SLP
Beta in relation to market/S&P 500--0.45
Expected beta in 1 year's time:
0.766
Expected beta in 3 year's time:
1.083
Unlevered (debt free) Beta:
0.446
Beta in relation to Nasdaq (XNAS):
0.844
Beta in relation to all global stocks::
0.661
Beta Comparison & Analysis
Beta of competitors/peers::
1.212
Beta is -63.10% lower than peers
Average Industry Beta:
0.87
Beta is -48.57% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
3.32%
Sustainable growth rate is -75.59% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.272
Alpha is -773.25% below industry average alpha yield
Alpha is 1729% higher than market/& is unsustainably high
Analysis of Cost of Capital of
SLP
Equity cost of capital:
0.062
Equity cost of capital is -31.78% below industry mean WACC
Unlevered (without debt) cost of capital:
6.19%
Before-tax cost of debt:
6.53%
After-tax cost of debt:
5.16%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
5.16%
WACC is -22.82% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$2.46
Revenue growth rate per share of (3Y):
6.87
Annual revenue growth rate is -89.86% below industry average
EPS:
$0.56
Expected Annual growth rate of EPS (3Y):
0.68%
Expected future EPS growth rate is -98.58% lower than the Health Information Services industry
Free cash flow (FCF) per share:
$0.69
Balance sheet equity growth per share: -0.06%
Equity growth rate per share is -99.51% lower than the industry
Debt per share
$0.04
EBITDA per share
$0.88
Valuation Analysis Today of
SLP
P/E Ratio:
100.39
P/E Ratio of Competitors/Peers:
213.77
P/E ratio is -53.04% lower than main peers & is -72.53% lower than the industry
Stock price/value with industry average P/E ratio: $204.65
SLP is -72.05% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $26.68
Present value of the expected future dividends only: $3.86
P/S (Price to Sales ratio):
23.23
Price to sales ratio is 206.48% above the industry mean
P/B (Price to book value ratio):
6.87
Price to free cash flow: 83.27
Price to free cash flow ratio is -52.38% lower than the industry
Net income growth rate (3Y):
-5.35%
Net income growth rate is -100.31% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 10.49%
Dividend yeild: 0.42%
Previous Dividend: $0.06
Previous adjusted dividend: $0.06
Previous Dividend: $0.24
-
-
Average dividend payment (long-term): $0.06
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 08/01/2022
Expected next dividend record date: 25/07/2022
Expected next dividend declaration date: 07/05/2022
Previous dividend payment date: 05/02/2022
Previous dividend record date: 25/04/2022
Previous dividend declaration date: 04/06/2022
Dividend History:
2022-04-22--$0.06
2021-10-22--$0.06
2021-04-23--$0.06
2022-01-28--$0.06
2021-07-23--$0.06
2021-01-22--$0.06
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
0.48%
Net debt to equity ratio:
-24.06%
Debt to assets ratio:
0.45%
Net debt to assets ratio:
-22.39%
Debt-to-asset ratio is -98.69% below industry average
Ability to repay debt:
Interest coverage ratio:
237.12
Interest coverage ratio is 1474.16% more than industry average
Looking forward:
Debt growth rate:
37.90%
Annual debt growth is -9% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.4
Statistical significance of correlation:
SLP has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.376
Stock price is 6.32% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.376
Correlation of price movement with Nasdaq (^IXIC):
-0.046
Covariance of price movement with the market:
-0.089
Kurtosis
4.483
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.153
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
SLP
Gross Profit Margin Ratio:
311%
Operating Profit Margin Ratio:
28.07%
Operating profit margin is -257.16% lower than the industry
Net Profit Margin Ratio:
311%
Effective Tax Rate:
17.99%
Effective tax rate is -9.19% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
6.84%
Return on equity (ROE) is -309.89% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
6.37%
Return on assets (ROA) is -466.86% lower than the industry
Financial Leverage:
1.0x
Current Ratio:
14.55
Current ratio is 158.37% above industry average
Cash Conversion Cycle (days):
100.2
Cash conversion cycle is 103.72% above industry average
The remaining useful life of property plant & equipment is: 5.6 years
Stock based compensation to net income ratio:
6.26%
In-depth Efficiency Analysis
Revenue generated per employee:
369.1K
Each employee generates -11% less revenue than industry average revenue per employee
EBITDA generated per employee:
131.7K
Each employee generates -421% less EBITDA than industry average revenue per employee
Profit generated per employee:
85.4K
Each employee generates -208% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
16.2K
Each employee generates 28% more free cash flow than industry average revenue per employee
Assets/Capital per employee
304.4K
Each employee generates 28% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 36.05%
Growth rate in R&D investment/expenditure is -375.35% lower than the industry
Competitors/Peer firms of
SLP
NLIGHT, INC. (XNAS:LASR)
MTSC
VEECO INSTRUMENTS INC. (XNAS:VECO)
NETGEAR, INC. (XNAS:NTGR)
VUZIX CORPORATION (XNAS:VUZI)
IDEANOMICS, INC. (XNAS:IDEX)
CEVA, INC (XNAS:CEVA)
ChipMOS TECHNOLOGIES INC. (XNAS:IMOS)
SECUREWORKS CORP. (XNAS:SCWX)
Current Analyst Ratings
Strong buy�4%
Buy�0%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
2/28/22
Revenue:
49.83M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
10.84M
38.99M
3.73M
-
21.27M
-
-
25.00M
221.00K
75.00K
3.65M
17.78M
13.99M
11.53M
14.06M
2.53M
11.53M
Statement of Cash Flow
Date:
Period:
845.00K
Differed Income Tax :
387.00K
Stock Based Compensation :
722.00K
Change in Working Capital :
- 1892.00K
Accounts Receivables:
- 1972.00K
Other Working Capital:
- 31.00K
Other Non-Cash Items:
494.00K
Net Cash Provided by Operating Activities:
3.58M
Investments in PP&E:
- 561.00K
Net Acquisitions:
-
Purchases of Investments:
- 12717.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
11/30/21
2022
Q1
41.68M
82.66M
124.34M
13.31M
-
2.26M
139.91M
3.49M
12.92M
24.63M
-
2.11M
- 2063.00K
41.09M
-
180.99M
19.00K
338.00K
584.00K
620.00K
8.64M
9.62M
810.00K
-
2.92M
-
12.54M
134.51M
34.22M
- 280.0K
-
November 30, 2021 at 12:00:00 AM
35.84M
168.46M
180.99M
-
1.15M
- 40532.0K
16.07M
- 838.00K
1.95M
-
-
-
- 1209.00K
372.00K
- 837.00K
-
4.70M
41.68M
36.98M
3.58M
- 1399.00K
2.18M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
SLP
2023
2024
2025
2026
2027
$59.22
$83.55
$86.06
$88.65
$91.31