MeritValue

Simulations Plus, Inc.

SLPdata completeness 88%15 fiscal years on file
The thesis, from the filings

Simulations Plus, Inc. earns about -5% on invested capital, below its ~9% cost of capital, and has bought back 3% of its shares over 5 years — no moat visible in the numbers. The estimate methods put fair value between $5.13 and $14.27 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$46.5M1$53.9M2$59.6M3$70M3$79.2M3
Net income$9.78M4$12.5M5$9.96M6$9.95M6−$64.7M6
Operating cash flow$19.2M7$17.9M8$21.9M9$13.3M9$18.1M9
Capital expenditure$1.63M10$819,00011$453,00012$566,00012$713,00012
Free cash flow (derived)$17.6M7$17.1M8$21.4M9$12.8M9$17.4M9
Total debt—————
Cash & equivalents$37M13$51.6M14$57.5M15$10.3M16$30.9M16
Diluted shares20.7M20.7M20.5M20.3M20.1M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$62.09
your share of equity
Profit it earned you last year
−$32.2
Free cash flow it threw off
$8.66
Debt you’d be carrying
—

10 shares is a claim on $62.09 of net worth that earned you −$32.2 and generated $8.66 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
-5% avg · 5y
FY21 8%FY22 10%FY23 9%FY24 6%FY25 -58%

It earned about -5% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
−3% shares · 5y

Share count is down 3% over 5 years — management has been buying back stock, quietly handing owners a bigger slice.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $5.13 and $14.27 a share. They rest on different assumptions, so where they diverge is the story.

DCF · Growth Exit 10Y
$13.54
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.6%
  • fcfBase$17.4M
DCF · Growth Exit 5Y
$14.27
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.6%
  • fcfBase$17.4M
Earnings Power Value
$5.13
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$9.95M
  • growthAssumed0.0%
Graham Number
not applicable
diluted EPS missing or non-positive — Graham Number undefined

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years0.6%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $14.27
The three cases
Bear0.0%$13.91
Base0.6%$14.27
Bull5.6%$17.33

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 0.6%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-08-31 · accession 0001023459-23-000124 (Revenues)
  2. 10-K · period ending 2022-08-31 · accession 0001023459-24-000136 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-08-31 · accession 0001023459-25-000060 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-08-31 · accession 0001023459-23-000124 (NetIncomeLoss)
  5. 10-K · period ending 2022-08-31 · accession 0001023459-24-000136 (NetIncomeLoss)
  6. 10-K · period ending 2023-08-31 · accession 0001023459-25-000060 (NetIncomeLoss)
  7. 10-K · period ending 2021-08-31 · accession 0001023459-23-000124 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-08-31 · accession 0001023459-24-000136 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-08-31 · accession 0001023459-25-000060 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-08-31 · accession 0001023459-23-000124 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-08-31 · accession 0001023459-24-000136 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-08-31 · accession 0001023459-25-000060 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-08-31 · accession 0001023459-22-000080 (CashAndCashEquivalentsAtCarryingValue)
  14. 10-K · period ending 2022-08-31 · accession 0001023459-23-000124 (CashAndCashEquivalentsAtCarryingValue)
  15. 10-K · period ending 2023-08-31 · accession 0001023459-24-000136 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2024-08-31 · accession 0001023459-25-000060 (CashAndCashEquivalentsAtCarryingValue)