Cotiviti Holdings (NASDAQ: COTV) and Simulations Plus (NASDAQ:SLP) are both healthcare companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, dividends and valuation.

Dividends

Simulations Plus pays an annual dividend of $0.20 per share and has a dividend yield of 1.2%. Cotiviti Holdings does not pay a dividend. Simulations Plus pays out 62.5% of its earnings in the form of a dividend.

Profitability

This table compares Cotiviti Holdings and Simulations Plus’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cotiviti Holdings 12.58% 8.55% 4.19%
Simulations Plus 24.86% 23.21% 19.23%

Insider & Institutional Ownership

32.0% of Simulations Plus shares are held by institutional investors. 36.9% of Simulations Plus shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Cotiviti Holdings and Simulations Plus, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cotiviti Holdings 0 3 5 0 2.63
Simulations Plus 0 0 0 0 N/A

Cotiviti Holdings presently has a consensus price target of $41.20, suggesting a potential upside of 17.41%. Given Cotiviti Holdings’ higher possible upside, equities research analysts clearly believe Cotiviti Holdings is more favorable than Simulations Plus.

Earnings & Valuation

This table compares Cotiviti Holdings and Simulations Plus’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Cotiviti Holdings $651.90 million 4.96 $222.12 million N/A N/A
Simulations Plus $21.83 million 13.31 $9.15 million $0.32 52.66

Cotiviti Holdings has higher revenue and earnings than Simulations Plus.

Summary

Simulations Plus beats Cotiviti Holdings on 8 of the 13 factors compared between the two stocks.

About Cotiviti Holdings

Cotiviti Holdings, Inc. is a provider of analytics-driven payment accuracy solutions. The Company focuses primarily on the healthcare sector. The Company operates through two segments: Healthcare, and Global Retail and Other. Through its Healthcare segment, the Company offers prospective and retrospective claims accuracy solutions to healthcare payers in the United States. The Company also provides analytics-based solutions unrelated to its healthcare payment accuracy solutions in the United States. Through its Global Retail and Other segment, the Company provides retrospective claims accuracy solutions to retailers primarily in the United States, Canada and the United Kingdom, as well as solutions that manage payment networks for a range of clients. The Company leverages its technology platform, configurable analytics, information assets and expertise in healthcare reimbursement to help its clients develop their claims payment accuracy.

About Simulations Plus

Simulations Plus, Inc. (Simulations Plus) develops and produces software for use in pharmaceutical research and for education, and provides consulting and contract research services to the pharmaceutical industry. The Company offers five software products for pharmaceutical research. ADMET (Absorption, Distribution, Metabolism, Excretion and Toxicity) Predictor is a computer program that takes molecular structures as inputs and predicts over 140 different properties for them at the rate of about 200,000 compounds per hour. MedChem Designer includes a small set of ADMET Predictor property predictions, allowing the chemist to modify molecular structures. MedChem Studio is a tool for medicinal and computational chemists for both data mining and for designing new drug-like molecules. DDDPlus simulates in-vitro laboratory experiments used to measure the rate of dissolution of the drug. GastroPlus simulates the absorption, pharmacokinetics, and pharmacodynamics of drugs.

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