Critical Review: Simulations Plus (NASDAQ:SLP) versus Scientific Learning (OTCMKTS:SCIL)

Scientific Learning (OTCMKTS:SCIL) and Simulations Plus (NASDAQ:SLP) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.

Institutional & Insider Ownership

78.1% of Simulations Plus shares are held by institutional investors. 16.1% of Scientific Learning shares are held by company insiders. Comparatively, 19.1% of Simulations Plus shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Scientific Learning and Simulations Plus”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Scientific Learning	N/A	N/A	N/A	N/A	N/A
Simulations Plus	$79.18 million	4.59	-$64.72 million	($3.22)	-5.61

Scientific Learning has higher earnings, but lower revenue than Simulations Plus.

Analyst Ratings

This is a summary of recent ratings and price targets for Scientific Learning and Simulations Plus, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Scientific Learning	0	0	0	0	0.00
Simulations Plus	1	6	3	1	2.36

Simulations Plus has a consensus target price of $25.00, suggesting a potential upside of 38.50%. Given Simulations Plus’ stronger consensus rating and higher probable upside, analysts clearly believe Simulations Plus is more favorable than Scientific Learning.

Profitability

This table compares Scientific Learning and Simulations Plus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Scientific Learning	N/A	N/A	N/A
Simulations Plus	-81.74%	13.27%	12.44%

Summary

Simulations Plus beats Scientific Learning on 9 of the 10 factors compared between the two stocks.

About Scientific Learning

Scientific Learning Corporation, an education company, develops, distributes, and licenses technology that accelerates learning by enhancing the processing efficiency of the brain. Its flagship Fast ForWord, a Web-based product, comprises Fast ForWord Language for elementary learners and Fast ForWord Literacy for adolescent learners that build foundational reading and language skills to help districts move below grade level learners to learn in the general classroom, and Fast ForWord Reading, which builds learning capacity through developing cognitive skills using exercises focusing on phonemic awareness, phonics and decoding, spelling, vocabulary, fluency, and comprehension. The company also provides Reading Assistant that offers a one-on-one reading tutor for learners; ResultsNow!, an online hosting and support solution for its Fast ForWord and Reading Assistant products; and BrainPro services targeted at learners who are below grade level. In addition, it offers on-site product training, technical installation, implementation management, consulting, and Web-based synchronous and asynchronous professional development services; and software technical update releases, as well as extensive telephone, email, and chat support services. The company offers learning solutions primarily to educational institutions, speech and language clinics, learning centers, and parents. Scientific Learning Corporation was founded in 1995 and is headquartered in Oakland, California.

About Simulations Plus

Simulations Plus, Inc. develops drug discovery and development software for modeling and simulation, and prediction of molecular properties utilizing artificial intelligence and machine learning based technology worldwide. The company operates through two segments, Software and Services. It offers GastroPlus, which simulates the absorption and drug interaction of compounds administered to humans and animals; and DDDPlus and MembranePlus simulation products. The company also provides products based on mechanistic and mathematical models, such as DILIsym, NAFLDsym, ILDsym, RENAsym, IPFsym, and MITOsym products. In addition, it offers Absorption, Distribution, Metabolism, Excretion, and Toxicity Predictor for chemistry-based computer program that takes molecular structures as inputs and predicts their properties; and MedChem Designer, as well as MonolixSuite products for modeling and simulation that allows for population analyses, rapid clinical trial data analyses, and regulatory submissions. Further, the company provides clinical-pharmacology-based consulting services, which includes population pharmacokinetic and pharmacodynamic modeling, exposure-response analyses, clinical trial simulations, data programming, and technical writing services in support of regulatory submissions; and early drug discovery services. Additionally, it offers creative and insightful consulting services to support its quantitative systems pharmacology/quantitative systems toxicology modelling. The company serves pharmaceutical, biotechnology, agrochemical, cosmetics, and food industry companies, as well as academic and regulatory agencies. Simulations Plus, Inc. was incorporated in 1996 and is headquartered in Lancaster, California.