Analyzing AtriCure (NASDAQ:ATRC) & TerrAscend (OTCMKTS:TSNDF)

TerrAscend (OTCMKTS:TSNDF) and AtriCure (NASDAQ:ATRC) are both small-cap medical companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
TerrAscend	-42.72%	-18.32%	-4.36%
AtriCure	-5.55%	-2.56%	-1.95%

Analyst Ratings

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TerrAscend	0	0	0	2	4.00
AtriCure	1	0	10	0	2.82

AtriCure has a consensus price target of $52.22, suggesting a potential upside of 44.38%. Given AtriCure’s higher possible upside, analysts plainly believe AtriCure is more favorable than TerrAscend.

Institutional and Insider Ownership

5.8% of TerrAscend shares are owned by institutional investors. Comparatively, 99.1% of AtriCure shares are owned by institutional investors. 32.2% of TerrAscend shares are owned by company insiders. Comparatively, 3.5% of AtriCure shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

TerrAscend has a beta of 1.45, meaning that its share price is 45% more volatile than the S&P 500. Comparatively, AtriCure has a beta of 1.56, meaning that its share price is 56% more volatile than the S&P 500.

Valuation and Earnings

This table compares TerrAscend and AtriCure”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TerrAscend	$306.68 million	0.47	-$80.23 million	($0.41)	-1.16
AtriCure	$518.31 million	3.47	-$44.70 million	($0.61)	-59.30

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

Summary

AtriCure beats TerrAscend on 10 of the 15 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 AtriCure

AtriCure, Inc. develops, manufactures, and sells devices for surgical ablation of cardiac tissue, exclusion of the left atrial appendage, and temporarily blocking pain by ablating peripheral nerves to medical centers in the United States, Europe, the Asia-Pacific, and internationally. The company offers Isolator Synergy Clamps, single-use disposable radio frequency products; multifunctional pens and linear ablation devices, such as the MAX Pen device that enables surgeons to evaluate cardiac arrhythmias, perform temporary cardiac pacing, sensing, and stimulation, and ablate cardiac tissue with the same device; and the Coolrail device, which enables users to make longer linear lines of ablation. It also provides cryoICE Cryoablation System that enables the user to make linear ablations of varied lengths; EPi-Sense Systems, a single-use disposable device used for the treatment of symptomatic, drug-refractory, and long-standing persistent atrial fibrillation; cryoSPHERE probe, which provides temporary pain relief by applying cryothermic energy to targeted intercoastal peripheral nerves in the ribcage; AtriClip System, an implantable device coupled to a single-use disposable applier; and LARIAT System, a suture-based solution for soft-tissue closure. In addition, the company sells Lumitip dissectors to separate tissues to provide access to key anatomical structures that are targeted for ablation; Glidepath guides for placement of clamps; Subtle Cannula's to support access for EPi-Sense catheters; and various reusable cardiac surgery instruments. It markets and sells its products through independent distributors and direct sales personnel. The company was incorporated in 2000 and is headquartered in Mason, Ohio.