Verrica Pharmaceuticals (NASDAQ:VRCA) vs. Assertio (NASDAQ:ASRT) Critical Survey

Verrica Pharmaceuticals (NASDAQ:VRCA) and Assertio (NASDAQ:ASRT) are both small-cap medical companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Analyst Ratings

This is a breakdown of current ratings and price targets for Verrica Pharmaceuticals and Assertio, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Verrica Pharmaceuticals	1	1	1	0	2.00
Assertio	1	4	0	0	1.80

Verrica Pharmaceuticals presently has a consensus target price of $17.00, indicating a potential upside of 188.14%. Assertio has a consensus target price of $22.65, indicating a potential downside of 3.08%. Given Verrica Pharmaceuticals’ stronger consensus rating and higher possible upside, analysts clearly believe Verrica Pharmaceuticals is more favorable than Assertio.

Volatility & Risk

Verrica Pharmaceuticals has a beta of 1.54, meaning that its stock price is 54% more volatile than the S&P 500. Comparatively, Assertio has a beta of 0.44, meaning that its stock price is 56% less volatile than the S&P 500.

Valuation & Earnings

This table compares Verrica Pharmaceuticals and Assertio”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Verrica Pharmaceuticals	$35.58 million	2.85	-$17.89 million	($1.03)	-5.73
Assertio	$118.71 million	1.27	-$30.38 million	($5.69)	-4.11

Verrica Pharmaceuticals has higher earnings, but lower revenue than Assertio. Verrica Pharmaceuticals is trading at a lower price-to-earnings ratio than Assertio, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Verrica Pharmaceuticals and Assertio’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Verrica Pharmaceuticals	-47.97%	-1,077.78%	-40.76%
Assertio	-34.94%	-38.72%	-13.32%

Insider & Institutional Ownership

42.5% of Verrica Pharmaceuticals shares are owned by institutional investors. Comparatively, 49.0% of Assertio shares are owned by institutional investors. 54.0% of Verrica Pharmaceuticals shares are owned by company insiders. Comparatively, 5.7% of Assertio shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Verrica Pharmaceuticals beats Assertio on 8 of the 14 factors compared between the two stocks.

About Verrica Pharmaceuticals

Verrica Pharmaceuticals Inc., a clinical-stage dermatology therapeutics company, develops medications for the treatment of skin diseases in the United States. Its product pipeline comprises YCANTH (VP-102), which is in phase III clinical trial for the treatment of common warts; and has completed phase II clinical trial for the treatment of external genital warts. The company also develops VP-315, an oncolytic peptide-based injectable therapy, which is in phase II clinical trial for the treatment of dermatology oncologic conditions which includes basal cell carcinoma; and VP-103, a cantharidin-based product candidate for the treatment of plantar warts and is in phase II clinical trial. In addition, it offers YCANTH for the treatment of molluscum contagiosum. The company has a collaboration and license agreement with Torii Pharmaceutical Co., Ltd. for the development and commercialization of its product candidates for the treatment of molluscum contagiosum and common warts in Japan, including VP-102; and a license agreement with Lytix Biopharma AS to develop and commercialize VP-315 for dermatological oncology indications, such as non-metastatic melanoma and non-metastatic merkel cell carcinoma. Verrica Pharmaceuticals Inc. was incorporated in 2013 and is headquartered in West Chester, Pennsylvania.

About Assertio

Assertio Holdings, Inc., a commercial pharmaceutical company, provides various products to patients in the United States. Its pharmaceutical products include INDOCIN, an oral and suppository solution for the treatment of moderate to severe rheumatoid arthritis, including acute flares of chronic disease; ankylosing spondylitis and osteoarthritis; and acute painful shoulder and gouty arthritis. It also provides Sympazan, a benzodiazepine for the adjunctive treatment of seizures related with lennox-gastaut syndrome in patients aged two years of age or older; CAMBIA, a non steroidal anti inflammatory drug (NSAID) for the treatment of migraine pain, nausea, photophobia, and phonophobia; Zipsor, a NSAID for relief of mild to moderate pain in adults; SPRIX, a NSAID for the short term management of moderate to moderately severe pain that requires analgesia at the opioid level; Otrexup, a single-dose auto-injector containing a prescription medicine and methotrexate that is used to treat patients with severe, active rheumatoid arthritis, and active polyarticular juvenile idiopathic arthritis, as well as treat adult with severe, recalcitrant, and disabling psoriasis; and ROLVEDON, a long-acting granulocyte colony-stimulating factor that is indicated to decrease the incidence of infection caused by febrile neutropenia. The company was formerly known as Assertio Therapeutics, Inc. and changed its name to Assertio Holdings, Inc. in May 2020. Assertio Holdings, Inc. was incorporated in 2020 and is headquartered in Lake Forest, Illinois.