Critical Contrast: Veru (NASDAQ:VERU) and Verano (OTCMKTS:VRNOF)

Verano (OTCMKTS:VRNOF) and Veru (NASDAQ:VERU) are both small-cap medical companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, dividends, profitability, earnings, analyst recommendations, institutional ownership and valuation.

Profitability

This table compares Verano and Veru’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Verano	-41.68%	-9.54%	-4.51%
Veru	N/A	-119.51%	-74.98%

Analyst Recommendations

This is a summary of recent ratings and price targets for Verano and Veru, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Verano	1	0	0	1	2.50
Veru	1	0	3	0	2.50

Veru has a consensus target price of $22.50, suggesting a potential upside of 703.57%. Given Veru’s higher probable upside, analysts plainly believe Veru is more favorable than Verano.

Earnings & Valuation

This table compares Verano and Veru”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Verano	$878.59 million	0.52	-$341.86 million	($0.98)	-1.29
Veru	$16.89 million	2.66	-$22.73 million	($2.20)	-1.27

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

Insider & Institutional Ownership

9.0% of Verano shares are owned by institutional investors. Comparatively, 47.2% of Veru shares are owned by institutional investors. 9.1% of Verano shares are owned by company insiders. Comparatively, 15.2% of Veru shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

Verano has a beta of 0.87, meaning that its share price is 13% less volatile than the S&P 500. Comparatively, Veru has a beta of -1.42, meaning that its share price is 242% less volatile than the S&P 500.

Summary

Veru beats Verano on 8 of the 14 factors compared between the two stocks.

About Verano

Verano Holdings Corp. operates as a vertically integrated multi-state cannabis operator in the United States. The company engages in the cultivation, processing, wholesale, and retail distribution of cannabis in Arizona, Arkansas, Connecticut, Florida, Illinois, Maryland, Massachusetts, Michigan, Nevada, New Jersey, Ohio, Pennsylvania, and West Virginia. It offers cannabis products under the Encore, Avexia, MUV, Savvy, BITS, and Verano brands for medical and adult-use markets. The company is headquartered in Chicago, Illinois.

About Veru

Veru Inc., a late clinical stage biopharmaceutical company, focuses on developing medicines for treatment of metabolic diseases, oncology, and acute respiratory distress syndrome (ARDS). Its marketed products comprise FC2 female condom for the dual protection against unplanned pregnancy and the transmission of sexually transmitted infections. The company’s development program includes enobosarm, a selective androgen receptor modulator for treatment of augment fat loss and to prevent muscle loss in sarcopenic obese and overweight elderly patients; Enobosarm, a selective androgen receptor modulator for the treatment of AR+ ER+ HER2- metastatic breast cancer; and sabizabulin, a microtubule disruptor for the treatment of hospitalized patients with viral lung infection on oxygen support who are at high risk for viral induced ARDS and death. The company was formerly known as The Female Health Company and changed its name to Veru Inc. in July 2017. Veru Inc. was incorporated in 1971 and is headquartered in Miami, Florida.