TerrAscend (OTCMKTS:TSNDF) & Varex Imaging (NASDAQ:VREX) Head to Head Analysis

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

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Varex Imaging and TerrAscend, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Varex Imaging	0	7	0	0	2.00
TerrAscend	0	1	0	0	2.00

Varex Imaging presently has a consensus target price of $16.88, suggesting a potential downside of 8.54%. Given Varex Imaging’s higher possible upside, research analysts clearly believe Varex Imaging is more favorable than TerrAscend.

Insider & Institutional Ownership

5.8% of TerrAscend shares are owned by institutional investors. 4.6% of Varex Imaging shares are owned by insiders. Comparatively, 31.9% of TerrAscend shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Varex Imaging	2.55%	9.19%	4.13%
TerrAscend	-31.01%	-32.93%	-5.49%

Valuation & Earnings

This table compares Varex Imaging and TerrAscend”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Varex Imaging	$844.60 million	0.93	-$70.30 million	$0.52	35.48
TerrAscend	$260.56 million	0.54	-$81.33 million	($0.11)	-4.14

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

Volatility and Risk

Varex Imaging has a beta of 1.02, indicating that its share price is 2% more volatile than the S&P 500. Comparatively, TerrAscend has a beta of 1.47, indicating that its share price is 47% more volatile than the S&P 500.

Summary

Varex Imaging beats TerrAscend on 9 of the 12 factors compared between the two stocks.

About Varex Imaging

Varex Imaging Corporation designs, manufactures, and sells X-ray imaging components. The company operates through two segments, Medical and Industrial. The Medical segment designs, manufactures, sells, and services X-ray imaging components, comprising X-ray tubes, digital detectors and accessories, ionization chambers, high voltage connectors, image-processing software and workstations, 3D reconstruction software, computer-aided diagnostic software, collimators, automatic exposure control devices, generators, and heat exchangers. This segment's products are used in a range of applications, including CT, mammography, oncology, cardiac, surgery, dental, and other diagnostic radiography uses. The Industrial segment designs, develops, manufactures, sells, and services Linatron X-ray linear accelerators, X-ray tubes, digital detectors, high voltage connectors, and coolers for use in security and inspection applications, such as baggage screening at airports, cargo screening at ports and borders, and nondestructive testing, irradiation, and inspection in various applications. The company sells its products through imaging system original equipment manufacturers, independent service companies, and distributors, as well as directly to end-users. It has operations in North America, South America, Europe, Russia, the Middle East, India, Africa, Asia, and Australia. Varex Imaging Corporation was incorporated in 2016 and is headquartered in Salt Lake City, 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.