20 Most Profitable Stocks of the Last 20 Years

6. Simulations Plus, Inc. (NASDAQ:SLP)

20-Year Annualized Return: 23.26% 

Simulations Plus, Inc. (NASDAQ:SLP) is a prominent player in the software industry, particularly focused on pharmaceutical research and education. The company develops and produces software used in pharmaceutical research and provides consulting and contract research services to the pharmaceutical industry.

Simulations Plus, Inc. (NASDAQ:SLP)’s total revenue increased by 21% year-over-year to $14.5 million in Q1 2024, with software revenue growing 25% to $7.6 million and services revenue up 17% to $6.9 million. The growth was driven by higher software revenues from the Quantitative Systems Pharmacology (QSP) oncology modeling platform and the impact of the Immunetrics acquisition. The Physiologically-Based Pharmacokinetics (PBPK) business unit also saw a notable 27% increase in revenue which reflected successful pipeline transitions to sales and expanding academic and customer bases across units. Their net income rose to $1.9 million, with diluted earnings per share (EPS) reaching $0.10, compared to $1.2 million and $0.06, respectively, in Q1 2023. The improved profitability was driven by an 87% gross margin in software due to enhanced efficiency, and a 47% gross margin in services following strategic cost reporting adjustments from recent restructuring efforts.

In Q1 2024, there were around 8 hedge fund holders in the company, down from 15 in the previous quarter. Ophir Asset Management held the largest position in the company with 439,729 worth $18,094,848. Simulations Plus (SLP) stock holds a “Strong Buy” rating from 3 analysts. The 2 analysts with 12-month price forecasts expect an average target of $60.5, ranging from $56 to $65. This suggests a potential upside of 51.67% from the current stock price of $39.89.