Analyzing Simulations Plus (SLP) & NetScout Systems (NTCT)

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Simulations Plus (NASDAQ: SLP) and NetScout Systems (NASDAQ:NTCT) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, earnings, valuation, profitability, dividends, institutional ownership and analyst recommendations.

Valuation & Earnings

This table compares Simulations Plus and NetScout Systems’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Simulations Plus $24.14 million 14.14 $5.78 million $0.34 57.94
NetScout Systems $986.79 million 2.24 $79.81 million $0.99 27.78

NetScout Systems has higher revenue and earnings than Simulations Plus. NetScout Systems is trading at a lower price-to-earnings ratio than Simulations Plus, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Simulations Plus and NetScout Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Simulations Plus 30.65% 26.19% 18.85%
NetScout Systems 8.06% 4.07% 2.71%

Institutional & Insider Ownership

35.1% of Simulations Plus shares are held by institutional investors. Comparatively, 98.0% of NetScout Systems shares are held by institutional investors. 33.5% of Simulations Plus shares are held by insiders. Comparatively, 3.5% of NetScout Systems shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Volatility & Risk

Simulations Plus has a beta of -0.56, suggesting that its share price is 156% less volatile than the S&P 500. Comparatively, NetScout Systems has a beta of 1.54, suggesting that its share price is 54% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Simulations Plus and NetScout Systems, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Simulations Plus 0 0 0 0 N/A
NetScout Systems 0 4 2 0 2.33

NetScout Systems has a consensus target price of $27.80, suggesting a potential upside of 1.09%. Given NetScout Systems’ higher probable upside, analysts plainly believe NetScout Systems is more favorable than Simulations Plus.

Dividends

Simulations Plus pays an annual dividend of $0.24 per share and has a dividend yield of 1.2%. NetScout Systems does not pay a dividend. Simulations Plus pays out 70.6% of its earnings in the form of a dividend.

Summary

NetScout Systems beats Simulations Plus on 8 of the 15 factors compared between the two stocks.

Simulations Plus Company Profile

Simulations Plus, Inc. develops drug discovery and development software for mechanistic modeling and simulation worldwide. The company offers GastroPlus, which simulates the absorption, pharmacokinetics (PK), and pharmacodynamics of drugs administered to humans and animals; DDDPlus that simulates in vitro laboratory experiments, which measure the rate of dissolution of the drug and additives in a dosage form; and MembranePlus, which simulates laboratory experiments. It also provides PKPlus, a standalone program that provides the functionality needed by pharmaceutical industry scientists to perform the analyses and generate the outputs needed to satisfy regulatory agency requirements for NCA and compartmental PK modelling; ADMET Predictor, a chemistry-based computer program, which takes molecular structures as inputs and predicts their properties; and MedChem Designer, a molecule drawing program or sketcher that integrates with MedChem Studio and ADMET Predictor. In addition, it offers MedChem Studio, a software tool for data mining and designing new molecules; KIWI, a cloud-based Web application, which organizes, processes, maintains, and communicates the volume of data and results generated by pharmacologists and scientists over the duration of a drug development program; DILIsym, a quantitative systems pharmacology software; and DILIsym, a software that is used to investigate the likelihood that a known drug molecule would cause injury to the liver. Further, the company provides consulting services ranging from early drug discovery through preclinical and clinical trial data analysis, and for submissions to regulatory agencies; and population modeling and simulation contract research services for the pharmaceutical and biotechnology industries. Additionally, it offers its pharmaceutical/chemistry software to pharmaceutical, biotechnology, agrochemical, and food companies. Simulations Plus, Inc. was founded in 1996 and is headquartered in Lancaster, California.

NetScout Systems Company Profile

NetScout Systems, Inc. provides real-time operational intelligence and performance analytics for service assurance, and cybersecurity solutions in the United States, Europe, Asia, and internationally. The company offers nGeniusONE management software that enables customers to predict, preempt, and resolve network and service delivery problems, as well as facilitate the optimization and capacity planning of their network infrastructures; and specialized platforms and analytic modules that enable its customers to analyze and troubleshoot traffic in radio access and WiFi networks, as well as gain timely insight into services, applications, and systems. It also provides Intelligent Data Sources under the Infinistream brand name that provide real-time collection and analysis of data from the network; packet flow switching solutions that delivers targeted network traffic access to an increasing number of monitoring and security systems; and a suite of test access points that enable non-disruptive access to network traffic with multiple link type and speed options. In addition, the company offers portable network analysis and troubleshooting tools, which help customers identify key issues that impact network and application performance. Further, it provides security solutions that enable service providers and enterprises to protect their networks against DDoS attacks; and threat detection solutions that enable enterprises to identify and investigate advanced threat campaigns that present tangible risks to the integrity of their networks. The company serves enterprise customers in industries, such as financial services, technology, manufacturing, healthcare, utilities, education, transportation, and retail; mobile operators, wireline operators, and cable operators; and governmental agencies through a direct sales force, and indirect reseller and distribution channels. NetScout Systems, Inc. was founded in 1984 and is headquartered in Westford, Massachusetts.

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