Critical Survey: DarioHealth (NASDAQ:DRIO) and Certara (NASDAQ:CERT)

Certara (NASDAQ:CERT) and DarioHealth (NASDAQ:DRIO) are both small-cap healthcare companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, valuation, earnings, analyst recommendations, profitability, risk and dividends.

Risk and Volatility

Certara has a beta of 1.42, meaning that its stock price is 42% more volatile than the S&P 500. Comparatively, DarioHealth has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500.

Institutional & Insider Ownership

74.0% of Certara shares are owned by institutional investors. Comparatively, 33.4% of DarioHealth shares are owned by institutional investors. 1.1% of Certara shares are owned by company insiders. Comparatively, 3.5% of DarioHealth shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations and price targets for Certara and DarioHealth, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Certara	1	6	4	1	2.42
DarioHealth	1	1	3	0	2.40

Certara presently has a consensus price target of $9.18, suggesting a potential downside of 15.77%. DarioHealth has a consensus price target of $9.00, suggesting a potential upside of 183.02%. Given DarioHealth’s higher possible upside, analysts clearly believe DarioHealth is more favorable than Certara.

Profitability

This table compares Certara and DarioHealth’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%
DarioHealth	-169.87%	-54.81%	-33.36%

Valuation & Earnings

This table compares Certara and DarioHealth”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Certara	$418.84 million	3.97	-$1.60 million	($0.45)	-24.22
DarioHealth	$22.36 million	1.39	-$41.71 million	($6.13)	-0.52

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

Summary

Certara beats DarioHealth 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 DarioHealth

DarioHealth Corp. operates as a digital health company in the United States, Canada, the European Union, Australia, and New Zealand. Its digital therapeutics platform and suite of solutions deliver personalized and dynamic interventions driven by data analytics and one-on-one coaching for diabetes, hypertension, weight management, musculoskeletal pain, and behavioral health. The company offers Dario Evolve, a metabolic solution to address metabolic health needs, such as diabetes, pre-diabetes, hypertension, and weight management; Dario Move, which address most common musculoskeletal conditions; Dario Elevate, a behavioral health solution that optimizes access to evidence-based care; and Dario One, a full suite of chronic condition management solution; and Dario blood glucose monitoring systems. It also provides native devices, such as glucose meter, blood pressure cuff, digital scale, and biofeedback sensor device, as well as live coaching services. The company was formerly known as LabStyle Innovations Corp. and changed its name to DarioHealth Corp. in July 2016. DarioHealth Corp. was incorporated in 2011 and is based in New York, New York.