Reviewing FSD Pharma (NASDAQ:HUGE) & HEXO (NYSE:HEXO)


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FSD Pharma (NASDAQ:HUGE) and HEXO (NYSE:HEXO) are both small-cap medical 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.

Earnings & Valuation

This table compares FSD Pharma and HEXO’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
FSD Pharma $190,000.00 183.55 -$39.20 million ($5.55) -0.33
HEXO $60.46 million 12.02 -$406.37 million ($0.96) -6.19

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

Profitability

This table compares FSD Pharma and HEXO’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
FSD Pharma N/A -111.76% -92.92%
HEXO -517.61% -13.15% -10.35%

Volatility and Risk

FSD Pharma has a beta of 1.39, meaning that its share price is 39% more volatile than the S&P 500. Comparatively, HEXO has a beta of 1.41, meaning that its share price is 41% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings for FSD Pharma and HEXO, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
FSD Pharma 0 0 1 0 3.00
HEXO 3 5 4 0 2.08

HEXO has a consensus price target of $3.88, indicating a potential downside of 34.72%. Given HEXO’s higher possible upside, analysts clearly believe HEXO is more favorable than FSD Pharma.

Institutional and Insider Ownership

0.7% of FSD Pharma shares are owned by institutional investors. Comparatively, 35.3% of HEXO shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

HEXO beats FSD Pharma on 8 of the 13 factors compared between the two stocks.

About FSD Pharma

FSD Pharma Inc., through its subsidiary, FV Pharma Inc., produces medical cannabis in Canada. The company focuses on the development of indoor grown pharmaceutical grade cannabis; and research and development of various cannabinoid-based treatments for central nervous system disorders and autoimmune diseases of the skin, GI tract, and musculoskeletal system, such as chronic pain. FSD Pharma Inc. has strategic alliance agreements with SciCann Therapeutics Inc., CannTab Therapeutics, and Solarvest BioEnergy Inc. The company was founded in 1998 and is headquartered in Toronto, Canada.

About HEXO

HEXO Corp., through its subsidiaries, produces, markets, and sells cannabis in Canada. It offers dried cannabis under the Time of Day and H2 lines; Elixir, a cannabis oil sublingual mist product line; and Decarb, an activated fine-milled cannabis powder product. The company offers its adult-use and medical products under the HEXO brand name. Additionally, it offers cannabis beverages under the Little Victory, House of Terpenes, Mollo, Veryvell, and XMG brand; and cannabis products under Original Stash and Up brand names. The company was formerly known as The Hydropothecary Corporation and changes its name to HEXO Corp. in August 2018. HEXO Corp. was founded in 2013 and is headquartered in Kanata, Canada.

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