Analyzing TerrAscend (OTCMKTS:TSNDF) and Local Bounti (NYSE:LOCL)

TerrAscend (OTCMKTS:TSNDF) and Local Bounti (NYSE:LOCL) are both small-cap medical companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, earnings, profitability, risk, analyst recommendations and dividends.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
TerrAscend	-131.52%	-2.35%	-0.98%
Local Bounti	-327.71%	-79.29%	-29.19%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for TerrAscend and Local Bounti, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TerrAscend	0	0	0	0	N/A
Local Bounti	0	1	4	0	2.80

Local Bounti has a consensus target price of $33.65, indicating a potential upside of 1,209.34%. Given Local Bounti’s higher possible upside, analysts clearly believe Local Bounti is more favorable than TerrAscend.

Earnings & Valuation

This table compares TerrAscend and Local Bounti’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TerrAscend	$247.83 million	2.48	-$329.91 million	N/A	N/A
Local Bounti	$19.47 million	1.09	-$111.07 million	($12.14)	-0.21

Local Bounti has lower revenue, but higher earnings than TerrAscend.

Institutional and Insider Ownership

0.0% of TerrAscend shares are owned by institutional investors. Comparatively, 15.6% of Local Bounti shares are owned by institutional investors. 32.9% of TerrAscend shares are owned by company insiders. Comparatively, 36.0% of Local Bounti shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility and Risk

TerrAscend has a beta of 2.59, suggesting that its share price is 159% more volatile than the S&P 500. Comparatively, Local Bounti has a beta of 1.53, suggesting that its share price is 53% more volatile than the S&P 500.

Summary

TerrAscend beats Local Bounti on 6 of the 11 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 cannabis-infused artisan edibles. It also operates retail dispensaries under the Apothecarium brand name in California, Pennsylvania, and New Jersey. In addition, the company owns various synergistic businesses under Gage Growth, Pinnacle, TerrAscend NJ, Ilera Healthcare, HMS Health and HMS Processing, Valhalla Confections, State Flower, Arise Bioscience Inc., and TerrAscend Canada brands. It serves medical and legal adult-use markets. The company was incorporated in 2017 and is headquartered in Mississauga, Canada.

About Local Bounti

Local Bounti Corporation grows and packs fresh greens in the United States. It produces lettuce, herbs, and loose-leaf lettuce. The company sells its products to food retailers and food service distributors. Local Bounti Corporation was founded in 2018 and is headquartered in Hamilton, Montana.