Certara (NASDAQ:CERT – Get Free Report) and Definitive Healthcare (NASDAQ:DH – Get Free Report) are both small-cap healthcare companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, risk, dividends, valuation, analyst recommendations, earnings and institutional ownership.
Risk & Volatility
Certara has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500. Comparatively, Definitive Healthcare has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500.
Valuation and Earnings
This table compares Certara and Definitive Healthcare”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Certara | $418.84 million | 2.96 | -$1.60 million | ($0.45) | -18.07 |
| Definitive Healthcare | $241.52 million | 0.46 | -$138.93 million | ($1.60) | -0.65 |
Certara has higher revenue and earnings than Definitive Healthcare. Certara is trading at a lower price-to-earnings ratio than Definitive Healthcare, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of recent ratings and price targets for Certara and Definitive Healthcare, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Certara | 1 | 6 | 4 | 1 | 2.42 |
| Definitive Healthcare | 3 | 5 | 0 | 1 | 1.89 |
Certara currently has a consensus target price of $8.28, indicating a potential upside of 1.82%. Definitive Healthcare has a consensus target price of $1.47, indicating a potential upside of 41.48%. Given Definitive Healthcare’s higher probable upside, analysts plainly believe Definitive Healthcare is more favorable than Certara.
Insider and Institutional Ownership
74.0% of Certara shares are owned by institutional investors. Comparatively, 98.7% of Definitive Healthcare shares are owned by institutional investors. 1.1% of Certara shares are owned by insiders. Comparatively, 17.1% of Definitive Healthcare shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Profitability
This table compares Certara and Definitive Healthcare’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Certara | -16.75% | 3.86% | 2.65% |
| Definitive Healthcare | -72.28% | 3.55% | 1.63% |
Summary
Certara beats Definitive Healthcare on 9 of the 13 factors compared between the two stocks.
About Certara
Certara, Inc., together with its subsidiaries, provides software products and technology-enabled services to customers for biosimulation in drug discovery, preclinical and clinical research, regulatory submissions, and market access in the United States and internationally. It offers solutions for model-informed drug development, as well as biosimulation solution used to predict both pharmacokinetics and pharmacodynamics. The company provides Simcyp Simulator, a mechanistic biosimulation platform mechanistic biosimulation investigational new drug and translational stages; Simcyp Biopharmaceutics, used to identify and refine drug formulations; and Simcyp Secondary Intelligence which integrates toxicology with quantitative analysis of networks of molecular and functional biological changes to identify drug toxicity and adverse drug reactions. In addition, it offers Phoenix WinNonlin, a platform for non-compartmental analysis, pharmacokinetic/pharmacodynamic, and toxicokinetic; phoenix hosted, that provides a secured and validated certara amazon web services workspace; Phoenix NLME, a population modeling and simulation software for nonlinear mixed effects models; and pirana modeling workbench. Further, the company provides pinnacle 21, a cloud-based platform for clinical data automation, standardization, and validation; Pinnacle 21 Data Exchange, used to define data standards and specifications; and Metadata Repository, to enable study design using controlled and standardized data. It serves life sciences companies, biopharmaceutical companies, research organizations, academic institutions, and global regulators, as well as animal health, crop science, bio science, medical devices, and public sector industries. Certara Inc. was founded in 2008 and is headquartered in Princeton, New Jersey.
About Definitive Healthcare
Definitive Healthcare Corp., together with its subsidiaries, provides software as a service (SaaS) healthcare commercial intelligence platform in the United States and internationally. Its SaaS platform provides information on healthcare providers and their activities to help its customers from product development to go-to-market planning, and sales and marketing execution. The company's platform consists of various functional areas, such as sales, marketing, clinical research and product development, strategy, talent acquisition, and physician network management. It serves biopharmaceutical and medical device companies, healthcare information technology companies, and healthcare providers; and other diversified companies comprising staffing and commercial real estate firms, financial institutions, and other organizations in the healthcare ecosystem. Definitive Healthcare Corp. was founded in 2011 and is headquartered in Framingham, Massachusetts.
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