Reviewing Owlet (NYSE:OWLT) and TerrAscend (OTCMKTS:TSNDF)

TerrAscend (OTCMKTS:TSNDF) and Owlet (NYSE:OWLT) are both small-cap healthcare companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, profitability, risk, analyst recommendations, valuation, institutional ownership and dividends.

Institutional and Insider Ownership

5.8% of TerrAscend shares are owned by institutional investors. Comparatively, 72.6% of Owlet shares are owned by institutional investors. 31.9% of TerrAscend shares are owned by company insiders. Comparatively, 36.2% of Owlet shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Volatility and Risk

TerrAscend has a beta of 1.46, meaning that its share price is 46% more volatile than the S&P 500. Comparatively, Owlet has a beta of 1.91, meaning that its share price is 91% more volatile than the S&P 500.

Profitability

This table compares TerrAscend and Owlet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TerrAscend	-31.01%	-32.93%	-5.49%
Owlet	-8.61%	-601.24%	-15.96%

Analyst Ratings

This is a summary of current ratings for TerrAscend and Owlet, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TerrAscend	0	1	0	0	2.00
Owlet	1	1	3	0	2.40

Owlet has a consensus price target of $15.00, indicating a potential upside of 262.76%. Given Owlet’s stronger consensus rating and higher possible upside, analysts clearly believe Owlet is more favorable than TerrAscend.

Valuation & Earnings

This table compares TerrAscend and Owlet”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TerrAscend	$260.56 million	0.58	-$81.33 million	($0.11)	-4.41
Owlet	$105.70 million	1.14	-$39.68 million	($0.75)	-5.51

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

Summary

Owlet beats TerrAscend on 9 of the 14 factors compared between the two stocks.

About TerrAscend

TerrAscend Corp. cultivates, processes, and sells medical and adult use cannabis in Canada and the United States. The company produces and distributes hemp-derived wellness products to retail locations; and manufactures vaporizables, concentrates, topicals, tinctures and edibles. It also operates retail dispensaries under the Apothecarium and State Flower brand names. The company was incorporated in 2017 and is headquartered in Mississauga, Canada.

About Owlet

Owlet, Inc. provides digital parenting solutions in the United States and internationally. The company's platform focuses on giving real-time data and insights to parents. It offers Dream Sock, a wearable infant health monitor equipped with pulse oximetry technology to track vitals signs, such as pulse rate, oxygen, activity, and sleep patterns; BabySat which is intended for infants with heightened health risk; Owlet Cam, a monitoring device in smartphones that offers video and audio, predictive sleep insights, and cry detections; and accessories, including Owlet Sleeper, as well as Duo and Dream Duo that combines Smart Sock with the Owlet Cam. The company was founded in 2012 and is headquartered in Lehi, Utah.