Analyzing Godaddy (GDDY) and Simulations Plus (SLP)

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

Risk and Volatility

Godaddy has a beta of 0.63, indicating that its share price is 37% less volatile than the S&P 500. Comparatively, Simulations Plus has a beta of -0.8, indicating that its share price is 180% less volatile than the S&P 500.

Institutional & Insider Ownership

93.6% of Godaddy shares are held by institutional investors. Comparatively, 35.7% of Simulations Plus shares are held by institutional investors. 7.6% of Godaddy shares are held by company insiders. Comparatively, 33.5% of Simulations Plus shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current recommendations for Godaddy and Simulations Plus, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Godaddy 1 5 11 0 2.59
Simulations Plus 0 0 0 0 N/A

Godaddy presently has a consensus price target of $76.50, indicating a potential downside of 2.67%. Given Godaddy’s higher possible upside, research analysts plainly believe Godaddy is more favorable than Simulations Plus.

Profitability

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

Net Margins Return on Equity Return on Assets
Godaddy 5.83% 8.78% 0.86%
Simulations Plus 29.88% 25.65% 17.87%

Earnings and Valuation

This table compares Godaddy and Simulations Plus’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Godaddy $2.23 billion 6.07 $136.40 million $0.42 187.14
Simulations Plus $24.14 million 14.38 $5.78 million $0.34 58.82

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

Dividends

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

Summary

Godaddy beats Simulations Plus on 9 of the 15 factors compared between the two stocks.

About Godaddy

GoDaddy Inc. designs and develops cloud-based technology products for small businesses, Web design professionals, and individuals in the United States and internationally. It provides domain name registration product that enables to engage customers at the initial stage of establishing a digital identity; hosting products, such as shared Website hosting, Website hosting on virtual private servers and virtual dedicated servers, managed hosting, and security. The company also offers presence products, including GoCentral, an online tool that enables customers to build Websites and online stores; and a range of marketing tools designed to help businesses acquire and engage customers, as well as search engine optimization that helps customers get their Websites found on search sites. In addition, the company offers business application products, including Microsoft Office 365, email accounts, email marketing, and telephony services. GoDaddy Inc. was incorporated in 2014 and is headquartered in Scottsdale, Arizona.

About Simulations Plus

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.

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