Owlet (NYSE:OWLT – Get Free Report) and TerrAscend (OTCMKTS:TSNDF – Get Free Report) are both small-cap healthcare companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, valuation, risk, analyst recommendations and earnings.
Valuation and Earnings
This table compares Owlet and TerrAscend”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Owlet | $105.70 million | 1.19 | -$39.68 million | ($0.75) | -5.73 |
| TerrAscend | $260.56 million | 0.58 | -$81.33 million | ($0.11) | -4.45 |
Owlet has higher earnings, but lower revenue 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.
Profitability
This table compares Owlet and TerrAscend’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Owlet | -8.61% | -601.24% | -15.96% |
| TerrAscend | -31.01% | -32.93% | -5.49% |
Volatility and Risk
Owlet has a beta of 1.91, suggesting that its share price is 91% more volatile than the S&P 500. Comparatively, TerrAscend has a beta of 1.46, suggesting that its share price is 46% more volatile than the S&P 500.
Insider & Institutional Ownership
72.6% of Owlet shares are held by institutional investors. Comparatively, 5.8% of TerrAscend shares are held by institutional investors. 36.2% of Owlet shares are held by insiders. Comparatively, 31.9% of TerrAscend shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Analyst Ratings
This is a breakdown of current recommendations and price targets for Owlet and TerrAscend, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Owlet | 1 | 1 | 3 | 0 | 2.40 |
| TerrAscend | 0 | 1 | 0 | 0 | 2.00 |
Owlet presently has a consensus target price of $15.00, indicating a potential upside of 249.32%. Given Owlet’s stronger consensus rating and higher possible upside, analysts clearly believe Owlet is more favorable than TerrAscend.
Summary
Owlet beats TerrAscend on 9 of the 14 factors compared between the two stocks.
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.
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.
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