CERTARA INC (CERT) Stock Fundamental Analysis
NASDAQ:CERT - Nasdaq - US15687V1098 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to CERT. CERT was compared to 38 industry peers in the Health Care Technology industry. While CERT seems to be doing ok healthwise, there are quite some concerns on its profitability. CERT is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
CERT had positive earnings in the past year.
CERT had a positive operating cash flow in the past year.
CERT had negative earnings in 4 of the past 5 years.
In the past 5 years CERT always reported a positive cash flow from operatings.
1.2 Ratios
CERT has a Return On Assets of -0.77%. This is amongst the best in the industry. CERT outperforms 81.58% of its industry peers.
The Return On Equity of CERT (-1.14%) is better than 81.58% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.77% | ||
| ROE | -1.14% | ||
| ROIC | N/A |
ROA(3y)-1.12%
ROA(5y)-1.63%
ROE(3y)-1.69%
ROE(5y)-2.47%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
CERT's Gross Margin of 59.88% is in line compared to the rest of the industry. CERT outperforms 52.63% of its industry peers.
In the last couple of years the Gross Margin of CERT has remained more or less at the same level.
CERT does not have Profit Margin and Operating Margin available, so we won't be analyzing them here.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 59.88% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.61%
GM growth 5Y-0.61%
2. Health
2.1 Basic Checks
CERT does not have a ROIC to compare to the WACC, probably because it is not profitable.
Compared to 1 year ago, CERT has more shares outstanding
The number of shares outstanding for CERT has been increased compared to 5 years ago.
Compared to 1 year ago, CERT has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.45 indicates that CERT is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a decent Altman-Z score value of 2.45, CERT is doing good in the industry, outperforming 71.05% of the companies in the same industry.
The Debt to FCF ratio of CERT is 4.97, which is a neutral value as it means it would take CERT, 4.97 years of fcf income to pay off all of its debts.
CERT's Debt to FCF ratio of 4.97 is fine compared to the rest of the industry. CERT outperforms 68.42% of its industry peers.
CERT has a Debt/Equity ratio of 0.28. This is a healthy value indicating a solid balance between debt and equity.
CERT has a Debt to Equity ratio (0.28) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.28 | ||
| Debt/FCF | 4.97 | ||
| Altman-Z | 2.45 |
ROIC/WACCN/A
WACC10.12%
2.3 Liquidity
CERT has a Current Ratio of 2.13. This indicates that CERT is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of CERT (2.13) is better than 65.79% of its industry peers.
A Quick Ratio of 2.13 indicates that CERT has no problem at all paying its short term obligations.
The Quick ratio of CERT (2.13) is better than 65.79% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.13 | ||
| Quick Ratio | 2.13 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.27% over the past year.
CERT shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 38.33% yearly.
The Revenue has grown by 8.69% in the past year. This is quite good.
The Revenue has been growing by 13.06% on average over the past years. This is quite good.
EPS 1Y (TTM)2.27%
EPS 3Y38.33%
EPS 5YN/A
EPS Q2Q%66.67%
Revenue 1Y (TTM)8.69%
Revenue growth 3Y10.42%
Revenue growth 5Y13.06%
Sales Q2Q%14.03%
3.2 Future
Based on estimates for the next years, CERT will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.63% on average per year.
Based on estimates for the next years, CERT will show a quite strong growth in Revenue. The Revenue will grow by 10.86% on average per year.
EPS Next Y12.83%
EPS Next 2Y13.53%
EPS Next 3Y10.79%
EPS Next 5Y12.63%
Revenue Next Year9.64%
Revenue Next 2Y9.27%
Revenue Next 3Y9.11%
Revenue Next 5Y10.86%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 26.07, the valuation of CERT can be described as expensive.
86.84% of the companies in the same industry are more expensive than CERT, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 29.35, CERT is valued at the same level.
With a Price/Forward Earnings ratio of 23.10, CERT is valued on the expensive side.
CERT's Price/Forward Earnings ratio is rather cheap when compared to the industry. CERT is cheaper than 84.21% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of CERT to the average of the S&P500 Index (22.10), we can say CERT is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.07 | ||
| Fwd PE | 23.1 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CERT is valued a bit cheaper than the industry average as 71.05% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CERT indicates a somewhat cheap valuation: CERT is cheaper than 76.32% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.78 | ||
| EV/EBITDA | 30.24 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CERT does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)2.03
PEG (5Y)N/A
EPS Next 2Y13.53%
EPS Next 3Y10.79%
5. Dividend
5.1 Amount
CERT does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
11.73
+0.11 (+0.95%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Technology
Earnings (Last)
Earnings (Next)
Inst Owners73.62%
Inst Owner Change0.06%
Ins Owners2.35%
Ins Owner Change0%
Market Cap1.89B
Analysts75.56
Price Target14.99 (27.79%)
Short Float %5.11%
Short Ratio4.82
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)15.83%
Min EPS beat(2)15.79%
Max EPS beat(2)15.86%
EPS beat(4)2
Avg EPS beat(4)-0.72%
Min EPS beat(4)-33.58%
Max EPS beat(4)15.86%
EPS beat(8)2
Avg EPS beat(8)-4.02%
EPS beat(12)4
Avg EPS beat(12)-1.74%
EPS beat(16)6
Avg EPS beat(16)-6.14%
Revenue beat(2)1
Avg Revenue beat(2)-1.33%
Min Revenue beat(2)-2.66%
Max Revenue beat(2)0%
Revenue beat(4)2
Avg Revenue beat(4)-1.55%
Min Revenue beat(4)-4.75%
Max Revenue beat(4)1.2%
Revenue beat(8)2
Avg Revenue beat(8)-1.98%
Revenue beat(12)5
Avg Revenue beat(12)-1.33%
Revenue beat(16)6
Avg Revenue beat(16)-1.75%
PT rev (1m)3.76%
PT rev (3m)2.96%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.6%
EPS NY rev (1m)0%
EPS NY rev (3m)-2.35%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.09%
Revenue NY rev (1m)-0.27%
Revenue NY rev (3m)-0.46%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.07 | ||
| Fwd PE | 23.1 | ||
| P/S | 4.9 | ||
| P/FCF | 31.78 | ||
| P/OCF | 23.47 | ||
| P/B | 1.78 | ||
| P/tB | N/A | ||
| EV/EBITDA | 30.24 |
EPS(TTM)0.45
EY3.84%
EPS(NY)0.51
Fwd EY4.33%
FCF(TTM)0.37
FCFY3.15%
OCF(TTM)0.5
OCFY4.26%
SpS2.39
BVpS6.57
TBVpS-1.14
PEG (NY)2.03
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.77% | ||
| ROE | -1.14% | ||
| ROCE | N/A | ||
| ROIC | N/A | ||
| ROICexc | N/A | ||
| ROICexgc | N/A | ||
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 59.88% | ||
| FCFM | 15.43% |
ROA(3y)-1.12%
ROA(5y)-1.63%
ROE(3y)-1.69%
ROE(5y)-2.47%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.61%
GM growth 5Y-0.61%
F-Score4
Asset Turnover0.24
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.28 | ||
| Debt/FCF | 4.97 | ||
| Debt/EBITDA | 4.41 | ||
| Cap/Depr | 30.93% | ||
| Cap/Sales | 5.46% | ||
| Interest Coverage | N/A | ||
| Cash Conversion | 121.36% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.13 | ||
| Quick Ratio | 2.13 | ||
| Altman-Z | 2.45 |
F-Score4
WACC10.12%
ROIC/WACCN/A
Cap/Depr(3y)27.38%
Cap/Depr(5y)24.09%
Cap/Sales(3y)4.51%
Cap/Sales(5y)3.98%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)2.27%
EPS 3Y38.33%
EPS 5YN/A
EPS Q2Q%66.67%
EPS Next Y12.83%
EPS Next 2Y13.53%
EPS Next 3Y10.79%
EPS Next 5Y12.63%
Revenue 1Y (TTM)8.69%
Revenue growth 3Y10.42%
Revenue growth 5Y13.06%
Sales Q2Q%14.03%
Revenue Next Year9.64%
Revenue Next 2Y9.27%
Revenue Next 3Y9.11%
Revenue Next 5Y10.86%
EBIT growth 1Y-127.86%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year20.27%
EBIT Next 3Y15.08%
EBIT Next 5Y14.29%
FCF growth 1Y-11.88%
FCF growth 3Y4.89%
FCF growth 5Y15.82%
OCF growth 1Y-2.77%
OCF growth 3Y10.04%
OCF growth 5Y16.17%