Head-To-Head Analysis: Arcutis Biotherapeutics (NASDAQ:ARQT) vs. CNS Pharmaceuticals (NASDAQ:CNSP)

Arcutis Biotherapeutics (NASDAQ:ARQT) and CNS Pharmaceuticals (NASDAQ:CNSP) are both small-cap medical companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, profitability, valuation, risk, institutional ownership, earnings and analyst recommendations.

Insider and Institutional Ownership

14.0% of CNS Pharmaceuticals shares are owned by institutional investors. 20.7% of Arcutis Biotherapeutics shares are owned by insiders. Comparatively, 3.9% of CNS Pharmaceuticals shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Arcutis Biotherapeutics and CNS Pharmaceuticals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arcutis Biotherapeutics	-439.79%	-294.85%	-78.57%
CNS Pharmaceuticals	N/A	-603.40%	-421.35%

Valuation & Earnings

This table compares Arcutis Biotherapeutics and CNS Pharmaceuticals’ gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arcutis Biotherapeutics	$59.61 million	14.78	-$262.14 million	($3.92)	-2.32
CNS Pharmaceuticals	N/A	N/A	-$18.85 million	($5.66)	-0.04

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

Analyst Recommendations

This is a breakdown of recent ratings for Arcutis Biotherapeutics and CNS Pharmaceuticals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arcutis Biotherapeutics	0	2	6	0	2.75
CNS Pharmaceuticals	0	0	0	0	N/A

Arcutis Biotherapeutics currently has a consensus target price of $26.56, indicating a potential upside of 191.82%. Given Arcutis Biotherapeutics’ higher probable upside, equities analysts plainly believe Arcutis Biotherapeutics is more favorable than CNS Pharmaceuticals.

Volatility and Risk

Arcutis Biotherapeutics has a beta of 1.14, meaning that its stock price is 14% more volatile than the S&P 500. Comparatively, CNS Pharmaceuticals has a beta of 2.67, meaning that its stock price is 167% more volatile than the S&P 500.

Summary

Arcutis Biotherapeutics beats CNS Pharmaceuticals on 7 of the 12 factors compared between the two stocks.

About Arcutis Biotherapeutics

Arcutis Biotherapeutics, Inc., a biopharmaceutical company, focuses on developing and commercializing treatments for dermatological diseases. Its lead product candidate is ARQ-151, a topical roflumilast cream that has completed Phase III clinical trials for the treatment of plaque psoriasis and atopic dermatitis. The company is also developing ARQ-154, a topical ZORYVE for the treatment of scalp and body psoriasis and seborrheic dermatitis; ARQ-252, a selective topical janus kinase type 1 inhibitor for hand eczema and vitiligo; ARQ-255, a topical JAK1 inhibitor for alopecia areata; and ARQ-234, a CD200R fusion protein for the treatment of moderate-to-severe atopic dermatitis. The company was formerly known as Arcutis, Inc. and changed its name to Arcutis Biotherapeutics, Inc. in October 2019. Arcutis Biotherapeutics, Inc. was incorporated in 2016 and is headquartered in Westlake Village, California.

About CNS Pharmaceuticals

CNS Pharmaceuticals, Inc., a clinical pharmaceutical company, engages in the development of anti-cancer drug candidates for the treatment of brain and central nervous system tumors. The company's lead drug candidate is Berubicin, which completed Phase I clinical trial that is used for the treatment of glioblastoma multiforme. It has license agreements with Houston Pharmaceuticals, Inc., Reata Pharmaceuticals, Inc., Pomeranian Medical University, and The University of Texas M.D. Anderson Cancer Center; and a development agreement with WPD Pharmaceuticals Inc. The company was incorporated in 2017 and is based in Houston, Texas.