Analyzing Phreesia (NYSE:PHR) & Certara (NASDAQ:CERT)

Certara (NASDAQ:CERT) and Phreesia (NYSE:PHR) are both small-cap healthcare companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, earnings, risk, dividends, analyst recommendations, institutional ownership and valuation.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Certara and Phreesia, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Certara	1	6	4	1	2.42
Phreesia	1	9	9	0	2.42

Certara presently has a consensus target price of $8.28, suggesting a potential downside of 1.81%. Phreesia has a consensus target price of $16.65, suggesting a potential upside of 37.58%. Given Phreesia’s stronger consensus rating and higher possible upside, analysts plainly believe Phreesia is more favorable than Certara.

Volatility and Risk

Certara has a beta of 1.44, suggesting that its share price is 44% more volatile than the S&P 500. Comparatively, Phreesia has a beta of 0.85, suggesting that its share price is 15% less volatile than the S&P 500.

Valuation and Earnings

This table compares Certara and Phreesia”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Certara	$418.84 million	3.07	-$1.60 million	($0.45)	-18.73
Phreesia	$495.59 million	1.51	$2.31 million	$0.15	80.67

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

Institutional and Insider Ownership

74.0% of Certara shares are held by institutional investors. Comparatively, 92.1% of Phreesia shares are held by institutional investors. 1.1% of Certara shares are held by company insiders. Comparatively, 5.2% of Phreesia shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Certara and Phreesia’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%
Phreesia	1.85%	5.13%	3.12%

Summary

Phreesia beats Certara on 12 of the 15 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 Phreesia

Phreesia, Inc. provides an integrated SaaS-based software and payment platform for the healthcare industry in the United States and Canada. The company offers access solutions that offers appointment scheduling system for online appointments, reminders, and referral tracking management; registration solution to automate patient self-registration; revenue cycle solution, which offer insurance-verification processes, point-of-sale payments applications, post-visit payment collection, and flexible payment options; and network connect solution to deliver clinically relevant content to patients. The company deploys its platform in a range of modalities, such as Phreesia Mobile, a patients' mobile device; Phreesia Dashboard, a web-based dashboard for healthcare services clients; PhreesiaPads, a self-service intake tablets; and Arrivals Kiosks, an on-site kiosks. It serves patients; single-specialty practices, multi-specialty groups, and health systems; and pharmaceutical, medical device, and biotechnology companies. The company was incorporated in 2005 and is based in Wilmington, Delaware.