Is SDGR a Buy or a Sell? The Bull and Bear Case (2026)

That depends on which case you find more convincing, and both are on this page. The bull case rests on Bunsen and the agentic AI product cycle, with revenue (ttm) at ~$260 million. The bear case rests on the core software business is decelerating at precisely the moment the stock is being repriced for acceleration, and net dollar retention of ~100% means the installed base is no longer expanding on its own. Analysts covering it are spread from $17.00 to $30.00, which is itself a signal that this is genuinely contested. If you believe the thesis, the real questions become sizing and overlap rather than timing. Walnut is not an investment adviser and this is not a recommendation.

Nobody can answer that for you, and the honest version of the question is narrower: has anything changed in the reason you bought it? The bear case on this page is the place to check. The core software business is decelerating at precisely the moment the stock is being repriced for acceleration, and net dollar retention of ~100% means the installed base is no longer expanding on its own. If that risk is what you were worried about and it is now playing out, that is a real signal. If the price simply fell while the thesis held, that is a different situation entirely. The most pessimistic published target is $17.00, -43.8% from the $30.24 price, which is one analyst's downside case rather than a floor. Walnut is not an investment adviser.

Bunsen and the agentic AI product cycle. Schrödinger launched early access to Bunsen, an agentic AI co-scientist that chains its physics engines into large-scale discovery workflows, with NVIDIA and Google Cloud supplying compute and the BioNeMo Agent Toolkit. The most optimistic analyst target on SDGR is $30.00, -0.8% from the $30.24 price. That figure is only reachable if this thesis works close to its best case.

The core software business is decelerating at precisely the moment the stock is being repriced for acceleration, and net dollar retention of ~100% means the installed base is no longer expanding on its own. General-purpose AI models and cheaper machine-learning tooling create genuine pricing pressure on specialised computational chemistry licences, a risk management has not quantified. On the therapeutics side, the pipeline shrank to two clinical assets after the SGR-2921 deaths, and both survivors now depend on finding a partner, which removes a large piece of the optionality investors once paid for. Drug discovery revenue is milestone-driven and can fall sharply in any quarter where nothing triggers, while equity-stake gains are non-cash until an acquirer appears. With roughly ~7x trailing revenue on an enterprise value basis and a stock that nearly tripled off its March low, a single guidance cut or a lost large customer could unwind a meaningful share of the move. The most pessimistic published target is $17.00, -43.8% from the current price, which is roughly what the stock is worth if these risks bite rather than the drivers.

Physics-based molecular simulation software for drug and materials discovery, paired with equity stakes in the drug programs its own platform designs.

Decide that in advance, because it is far harder to think clearly once a position is moving against you. The concrete tripwires here: the driver behind the bull case (Bunsen and the agentic AI product cycle) stalling in the reported numbers rather than in the narrative, the risk above (the core software business is decelerating at precisely the moment the stock is being repriced for acceleration, and net dollar retention of ~100% means the installed base is no longer expanding on its own) turning from a possibility into a reported fact, or the position growing large enough that a bad outcome would matter to your whole portfolio regardless of who is right.

Two things. The software segment licenses molecular simulation tools (Maestro, Glide, FEP+ and now the Bunsen AI co-scientist) that predict how molecules bind to protein targets, generating ~$32.5 million in the June 2026 quarter. The drug discovery segment applies those tools to Schrödinger's own and partnered programs, earning collaboration fees, milestones, royalties and equity stakes.

Shares rose roughly 60% in a single week to a 52-week high of ~$30.41 on 17 September 2026, on volume around six times the 30-day average. No single company disclosure explains it. Reporting attributed the move to broad investor rotation into AI drug discovery names, helped by the September 9 launch of Tectora Therapeutics and continued attention to the Bunsen and Bristol Myers Squibb arrangement.

Not on an underlying basis. Adjusted EBITDA was about negative $114.9 million in 2025, improved from negative $152.5 million in 2024. Reported net income turns positive in quarters where equity stakes are marked up, as in Q2 2026's ~$6.0 million profit, which came alongside a ~$45.9 million gain tied largely to Eli Lilly's acquisition of Ajax Therapeutics.