A Pair of Stock To Put On Your Watchlist: Schrodinger Inc. (SDGR), Brinker International Inc. (EAT)

Schrodinger Inc. (NASDAQ: SDGR) shares are 115.40% up in the year-to-date (YTD) period and have moved -2.74% or -$1.74 lower in the latest trading session. However, stock’s trailing 12-month performance remains nearly +141.92% lower. Comparatively, the stock is -38.00% down YTD and -11.36% over the trailing 3-month period. If we look at the shorter duration, its week performance is -10.18% and -18.69% over the month.

Analyst Recommendations

On March 02, 2020, Jefferies recommended the SDGR stock is a Hold, while earlier, Morgan Stanley had Initiated the stock as a Equal-Weight on March 02, 2020. 4 analysts offering the recommendations for the stock have a consensus rating of 2.70 to suggest that the SDGR stock is a “Moderate Buy. 0 of the 4 analysts rate the stock as a “Sell”, while 0 has rated it as “Underweight”. 1 recommend buying, with 0 rating it as an Overweight.

The stock currently trades at $61.69 and analysts tracking its performance over the next 12 months have a consensus estimate price target of $86.75. The forecasts give the Schrodinger Inc. stock a price target range of $93.00 on the higher side while at least one analyst think the stock could plunge to a low of $70.00. The two limits represent an upside potential of 33.67% or 11.87%.

Earnings Forecast

For the current year, earnings should grow to an average of -$0.42, up 29.10% from -$4.09 reported last year. Analysts also offered guidance for the next financial quarter, with their average projected EPS at between -$0.25 and $0.12. Wall Street estimates earnings per share to be at an average of -$0.22 for the next year.

Insider Transactions Summary

According to SEC data, total insider shares purchases at the company stands at 12 over the last 12 months, while SEC filings reveal that there have been 38 insider sales over the same period. Insiders have purchases 16,644,589 shares while those sold by company executives and officers stand at 2,812,249. The last 3 months have seen insiders trade a total of 148,433 and 2,812,249 in purchases and sales respectively.

Herman Jenny, a Vice President, Controller at the company, sold 2,000 shares worth $0.14 million at $67.77 per share on Aug 19. The Vice President, Controller had earlier sold another 1,000 SDGR shares valued at $70000.0 on Aug 21. The shares were sold at $70.00 per share. Lebowitz Joel sold 117,051 shares at $67.77 per share on Aug 19 for a total of $7.93 million while Friesner Richard, (Director) sold 500,000 shares on Aug 17 for $31.02 million with each share fetching $62.04.

Brinker International Inc. (NYSE:EAT), on the other hand, is trading around $45.61 with a market cap of $1.82B and analyst research firms have a positive stance on its shares. Analysts predict that the stock will reach $38.62 and spell out a less modest performance – a -18.1% return. Some analysts are even forecasting $2.05 per share in earnings this year on a short term (1 year) basis.

Let us briefly look at the Brinker International Inc. (EAT) financials, with a focus on its operating details as indicated in its earnings report for the last quarter.

Company balance sheet and cash flow

EAT’s operating margin was positive on the trailing 12 months basis, remaining steady at 2.00%, while the operating expenses over the recent quarter were at $99.4 million. This represented a 82.35% of the company’s total revenues which amounted $563.2 million. With this in place, we can see that the company’s diluted EPS declined -$1.30 on the year-over-year period, growing to $1.18 as given in the last earnings report.

In terms of the balance sheet & cash flow as of (Sep 2020), the total assets figure advanced to $2.36 billion from $2.59 billion over the previous quarter. The cash flow from operating activities totaled $245.0 million, significantly higher than the $212.7 million reported in the year-ago quarter. The company’s free cash flow for the quarter was $140.5 million.

Insider activity

Insiders have transacted a total of 40 times at Brinker International Inc. over the last 6 months, with insider purchases undertaken 24 times and accounting for 141,387 shares. Insider sales totaled 70,635 shares over the same period, with these deals completed in 16 transactions. Looking at these numbers, we realize that net purchases over that period are 8.0 shares. Insiders now hold a total of 744.93k shares after the latest sales, with 16.60% net shares purchased.

Major holders

Insiders own 1.20% of the company shares with a share float percentage of 41.50M. Investors are also buoyed by the number of investors in a company, with Brinker International Inc. having a total of 340 institutions that hold shares in the company. The top two institutional holders are Blackrock Inc. with over 6.77 million shares worth more than $162.52 million. As of Jun 29, 2020, Blackrock Inc. held 15.03% of shares outstanding.

The other major institutional holder is Vanguard Group, Inc. (The), with the investment firm holding over 4.78 million shares as of Jun 29, 2020. The firm’s total holdings are worth over $114.61 million and represent 10.60% of shares outstanding.