Simulations Plus, Inc (NASDAQ:SLP) Poised For Strategic Transition After Proposed Altaris Acquisition

Simulations Plus enters a near-term strategic inflection as a proposed all-cash acquisition and heightened governance scrutiny materially reshape the company’s immediate corporate backdrop and valuation context.

Recent News

Mid‑June 2026 filings and press coverage show Simulations Plus agreed to an all‑cash acquisition by affiliates of Altaris, LLC at $18.50 per share (deal subject to stockholder and regulatory approvals), while multiple law firms announced shareholder investigations into the sale process and prior guidance/impairment disclosures; earlier spring releases highlighted collaborations with NVIDIA (May 6, 2026) and with Lonza and the U.S. FDA (April 21, 2026).

Technical Analysis

ADX & Directional Indicators: ADX at 40.46 indicates a very strong underlying trend; DI+ at 31.24 with a decreasing trend signals waning upside momentum, while DI‑ at 12.35 with a decreasing trend signals retreating downside pressure — together these readings point to a strong trend that now favors consolidation around the current valuation band rather than an immediate breakout.

MACD: MACD reads 0.48 with a decreasing trend and sits below the signal line (0.59); that configuration indicates bearish momentum has re‑emerged and reduces the probability of an immediate bullish acceleration absent a MACD reversal above the signal line.

MRO (Momentum/Regression Oscillator): MRO registers at -0.12 with a peak & reversal pattern, which places the price slightly below the WMDST target and implies modest upward pressure to re‑align with valuation rather than strong downside risk.

RSI & Price Structure: RSI at 63.65 with an increasing trend signals bullish momentum without overbought extremes. Price $18.23 sits near the 12‑day EMA ($18.20, increasing) and the 20‑day average ($18.29), above the 50‑day ($16.69) and 200‑day ($16.03) averages; Bollinger bands remain narrow (upper ~ $18.36 / lower ~ $18.22), suggesting low volatility and a technical environment favoring rangebound trading until one of the directional momentum indicators confirms continuation.

Support/Resistance Context: SuperTrend lower support at $17.54 and the 12/20‑day EMA cluster provide immediate support; the proximity to the analyst price‑target mean ($17.12) and the wide target range ($9.58–$33.50) frame near‑term upside as contingent on re‑acceleration of momentum indicators.

 


Fundamental Analysis

Profitability & Margins: Operating (EBIT) margin stands at 20.56%, improving YoY by 39.77% but down QoQ by 11.30%, indicating meaningful year‑over‑year operational leverage while recent quarters show margin compression versus the prior quarter.

Earnings: Reported EPS $0.30 versus an estimate of $0.23 produced an EPS surprise of +30.44%, while forward EPS of $0.2206 implies a forward P/E of 65.61; trailing P/E registers at 54.17, reflecting elevated valuation relative to near‑term earnings power.

Revenue & Growth: Total revenue $21,886,000 with YoY revenue growth of 7.35% but a reported QoQ revenue change of -131.07% (seasonal or one‑off effects appear in the sequential figure); the YoY increase shows underlying top‑line expansion despite quarter‑to‑quarter variability.

Cash, Liquidity & Leverage: Cash $35,324,000 and cash & short‑term investments $49,990,000 support a current ratio of 5.54 and a cash ratio of 3.68; total debt $487,000 produces debt‑to‑assets of 0.32% and debt‑to‑equity of 0.35%, indicating a near‑net‑cash balance sheet and strong liquidity coverage of short‑term obligations.

Cash Flow & Capital Efficiency: Free cash flow $7,948,000 (free cash flow yield 2.42%) and operating cash flow $7,342,000 produce a cash‑to‑earnings conversion above 200% (cash flow to earnings 2.05), highlighting robust cash generation versus reported net income. Asset turnover sits at 0.146, and return on equity equals 2.57%, reflecting capital‑light software economics but modest returns on invested capital.

Valuation Notes: WMDST values the stock as EVR 12.75 while enterprise multiple stands at 47.56; high cash balances and near‑zero leverage support that valuation stance, even as elevated P/E and forward P/E reflect compressed near‑term earnings growth expectations (forward EPS $0.2206) and the market’s premium for recurring, AI‑enabled software revenue.

MOST-RECENT QUARTERLY REPORT
REPORT PERIOD ENDING: 2026-05-31
REPORT DATE: 2026-07-09
NEXT REPORT DATE: 2026-10-08
CASH FLOW  Begin Period Cash Flow $ 25.7 M
 Operating Cash Flow $ 7.3 M
 Capital Expenditures $ -761.00 K
 Change In Working Capital $ 1.6 M
 Dividends Paid —
 Cash Flow Delta $ 9.6 M
 End Period Cash Flow $ 35.3 M
 
INCOME STATEMENT REVENUE
 Total Revenue $ 21.9 M
 Forward Revenue $ 6.8 M
COSTS
 Cost Of Revenue $ 6.8 M
 Depreciation $ 1.4 M
 Depreciation and Amortization $ 1.4 M
 Research and Development $ 3.4 M
 Total Operating Expenses $ 17.4 M
PROFITABILITY
 Gross Profit $ 15.1 M
 EBITDA $ 5.9 M
 EBIT $ 4.5 M
 Operating Income $ 4.5 M
 Interest Income $ 344.0 K
 Interest Expense —
 Net Interest Income $ 344.0 K
 Income Before Tax $ 4.8 M
 Tax Provision $ 1.2 M
 Tax Rate 25.614 %
 Net Income $ 3.6 M
 Net Income From Continuing Operations $ 3.6 M
EARNINGS
 EPS Estimate $ 0.23
 EPS Actual $ 0.30
 EPS Difference $ 0.07
 EPS Surprise 30.435 %
 Forward EPS $ 0.22
 
BALANCE SHEET ASSETS
 Total Assets $ 153.0 M
 Intangible Assets $ 71.4 M
 Net Tangible Assets $ 67.6 M
 Total Current Assets $ 75.1 M
 Cash and Short-Term Investments $ 50.0 M
 Cash $ 35.3 M
 Net Receivables $ 17.2 M
 Inventory —
 Long-Term Investments $ 1.4 M
LIABILITIES
 Accounts Payable $ 2.2 M
 Short-Term Debt —
 Total Current Liabilities $ 13.6 M
 Net Debt —
 Total Debt $ 487.0 K
 Total Liabilities $ 13.9 M
EQUITY
 Total Equity $ 139.0 M
 Retained Earnings $ -25.58 M
VALUATION & PER-SHARE METRICS EQUITY & PER-SHARE METRICS
 Book Value Per-Share $ 6.88
 Shares Outstanding 20.216 M
 Revenue Per-Share $ 1.08
VALUATION
 Market Capitalization $ 328.5 M
 Enterprise Value $ 279.0 M
 Enterprise Multiple 47.561
Enterprise Multiple QoQ 44.688 %
Enterprise Multiple YoY -20.434 %
Enterprise Multiple IPRWA —
 EV/R 12.75
CAPITAL STRUCTURE
 Asset To Equity 1.1
 Asset To Liability 10.973
 Debt To Capital 0.003
 Debt To Assets 0.003
Debt To Assets QoQ -8.357 %
Debt To Assets YoY -40.561 %
Debt To Assets IPRWA —
 Debt To Equity 0.004
Debt To Equity QoQ -7.895 %
Debt To Equity YoY -39.759 %
Debt To Equity IPRWA —
PRICE-BASED VALUATION
 Price To Book (P/B) 2.363
Price To Book QoQ 14.016 %
Price To Book YoY -15.297 %
Price To Book IPRWA —
 Price To Earnings (P/E) 54.171
Price To Earnings QoQ 38.178 %
Price To Earnings YoY 0.456 %
Price To Earnings IPRWA —
 PE/G Ratio -3.792
 Price To Sales (P/S) 15.012
Price To Sales QoQ 31.524 %
Price To Sales YoY -11.478 %
Price To Sales IPRWA —
FORWARD MULTIPLES
Forward P/E 65.611
Forward PE/G -4.593
Forward P/S 48.129
EFFICIENCY OPERATIONAL
 Operating Leverage 2.029
ASSET & SALES
 Asset Turnover Ratio 0.146
Asset Turnover Ratio QoQ -14.455 %
Asset Turnover Ratio YoY 20.513 %
Asset Turnover Ratio IPRWA —
 Receivables Turnover 1.237
Receivables Turnover Ratio QoQ -22.759 %
Receivables Turnover Ratio YoY -4.975 %
Receivables Turnover Ratio IPRWA —
 Inventory Turnover —
Inventory Turnover Ratio QoQ —
Inventory Turnover Ratio YoY —
Inventory Turnover Ratio IPRWA —
 Days Sales Outstanding (DSO) 73.739
CASH CYCLE
 Cash Conversion Cycle Days (CCC) 56.733
Cash Conversion Cycle Days QoQ 21.064 %
Cash Conversion Cycle Days YoY —
Cash Conversion Cycle Days IPRWA —
CAPITAL DEPLOYMENT
 Cash Conversion Ratio 0.356
 CapEx To Revenue -0.035
 CapEx To Depreciation -0.556
 
CAPITAL, LIQUIDITY & COVERAGE CAPITAL STRUCTURE
 Total Capital $ 139.0 M
 Net Invested Capital $ 139.0 M
 Invested Capital $ 139.0 M
 Net Tangible Assets $ 67.6 M
 Net Working Capital $ 61.6 M
LIQUIDITY
 Cash Ratio 3.685
 Current Ratio 5.538
Current Ratio QoQ 1.173 %
Current Ratio YoY 8.359 %
Current Ratio IPRWA —
 Quick Ratio —
Quick Ratio QoQ —
Quick Ratio YoY —
Quick Ratio IPRWA —
COVERAGE & LEVERAGE
 Debt To EBITDA 0.083
 Cost Of Debt 109.867 %
 Interest Coverage Ratio 6.123
Interest Coverage Ratio QoQ -20.089 %
Interest Coverage Ratio YoY 50.217 %
Interest Coverage Ratio IPRWA —
 Operating Cash Flow Ratio 0.541
TIMING / LIQUIDITY
 Days Payables Outstanding (DPO) 17.006
DIVIDENDS
 Dividend Coverage Ratio —
 Dividend Payout Ratio —
 Dividend Rate —
 Dividend Yield —
PERFORMANCE GROWTH
 Asset Growth Rate 4.432 %
 Revenue Growth -9.901 %
Revenue Growth QoQ -131.071 %
Revenue Growth YoY 7.351 %
Revenue Growth IPRWA —
 Earnings Growth -14.286 %
Earnings Growth QoQ -108.442 %
Earnings Growth YoY -131.633 %
Earnings Growth IPRWA —
MARGINS
 Gross Margin 69.117 %
Gross Margin QoQ 4.003 %
Gross Margin YoY 7.999 %
Gross Margin IPRWA —
 EBIT Margin 20.557 %
EBIT Margin QoQ -11.304 %
EBIT Margin YoY 39.767 %
EBIT Margin IPRWA —
 Return On Sales (ROS) 20.557 %
Return On Sales QoQ -11.304 %
Return On Sales YoY 39.767 %
Return On Sales IPRWA —
CASH FLOW
 Free Cash Flow (FCF) $ 7.9 M
 Free Cash Flow Yield 2.419 %
Free Cash Flow Yield QoQ 20.169 %
Free Cash Flow Yield YoY 18.404 %
Free Cash Flow Yield IPRWA —
 Free Cash Growth 42.437 %
Free Cash Growth QoQ -37.006 %
Free Cash Growth YoY -13.183 %
Free Cash Growth IPRWA —
 Free Cash To Net Income 2.223
 Cash Flow Margin 33.547 %
 Cash Flow To Earnings 2.054
VALUE & RETURNS
 Economic Value Added $ 0.04
 Return On Assets (ROA) 2.388 %
Return On Assets QoQ -25.141 %
Return On Assets YoY -105.956 %
Return On Assets IPRWA —
 Return On Capital Employed (ROCE) 3.227 %
 Return On Equity (ROE) 0.026
Return On Equity QoQ -24.159 %
Return On Equity YoY -104.727 %
Return On Equity IPRWA —
 DuPont ROE 2.621 %
 Return On Invested Capital (ROIC) 2.407 %
Return On Invested Capital QoQ -25.779 %
Return On Invested Capital YoY 9.409 %
Return On Invested Capital IPRWA —

Six-Week Outlook

Corporate developments — a proposed $18.50 per‑share acquisition and concurrent shareholder investigations — create a near‑term corporate event backdrop that will likely dominate price action over the next six weeks. Technical indicators suggest a consolidation regime around $17.50–$18.50: ADX signals a strong underlying trend while MACD momentum sits bearish below its signal line and RSI remains constructive but not extended. Fundamental liquidity and strong free cash flow provide a valuation floor; however, completion timing and approval milestones for the transaction will determine directional resolve. Expect limited volatility expansion until clear resolution of the sale process or a decisive technical signal (MACD crossing above signal) emerges.

About Simulations Plus, Inc.

Simulations Plus, Inc. (NASDAQ:SLP) develops advanced software solutions for drug discovery and development, leveraging artificial intelligence and machine learning technologies. The company operates through its Software and Services segments, offering a range of products designed to simulate and predict molecular properties and interactions. Key offerings include GastroPlus, which models the absorption and interaction of compounds in humans and animals, as well as DDDPlus and MembranePlus simulation tools. Simulations Plus also provides mechanistic and mathematical model-based products such as DILIsym, NAFLDsym, ILDsym, IPFsym, RENAsym, MITOsym, and OBESITYsym. These products assist in understanding complex biological systems and drug interactions. The company offers the ADMET Predictor, a chemistry-based program that predicts molecular properties from structures, and the MedChem Designer for molecular design and analysis. Additionally, Simulations Plus delivers consulting services in clinical pharmacology, including population pharmacokinetic and pharmacodynamic modeling, exposure-response analyses, and clinical trial simulations. Their consulting services support regulatory submissions and early drug discovery efforts. The company’s clientele spans pharmaceutical, biotechnology, agrochemical, cosmetics, and food industries, as well as academic and regulatory institutions. Established in 1996, Simulations Plus is headquartered in Lancaster, California.



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