Medifast (NYSE:MED – Get Free Report) and Dermata Therapeutics (NASDAQ:DRMA – Get Free Report) are both small-cap consumer staples companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, earnings, profitability, dividends and analyst recommendations.
Institutional & Insider Ownership
95.5% of Medifast shares are held by institutional investors. Comparatively, 8.7% of Dermata Therapeutics shares are held by institutional investors. 3.7% of Medifast shares are held by insiders. Comparatively, 21.9% of Dermata Therapeutics shares are held by 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
Medifast has a beta of 0.65, suggesting that its stock price is 35% less volatile than the S&P 500. Comparatively, Dermata Therapeutics has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500.
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Medifast | 1 | 1 | 0 | 1 | 2.33 |
| Dermata Therapeutics | 1 | 0 | 1 | 0 | 2.00 |
Medifast currently has a consensus target price of $12.00, indicating a potential downside of 4.78%. Dermata Therapeutics has a consensus target price of $10.00, indicating a potential upside of 809.09%. Given Dermata Therapeutics’ higher probable upside, analysts clearly believe Dermata Therapeutics is more favorable than Medifast.
Valuation & Earnings
This table compares Medifast and Dermata Therapeutics”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Medifast | $385.79 million | 0.37 | -$18.67 million | ($2.33) | -5.41 |
| Dermata Therapeutics | N/A | N/A | -$7.56 million | ($5.31) | -0.21 |
Dermata Therapeutics has lower revenue, but higher earnings than Medifast. Medifast is trading at a lower price-to-earnings ratio than Dermata Therapeutics, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Medifast and Dermata Therapeutics’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Medifast | -8.08% | -6.69% | -5.25% |
| Dermata Therapeutics | N/A | -127.91% | -105.05% |
About Medifast
Medifast, Inc., through its subsidiaries, engages in the manufacture and sale of weight loss, weight management, and healthy living products in the United States and the Asia-Pacific. It offers bars, puffs, cereal, crunchers, drinks, hearty choices, oatmeal, pancakes, pudding, soft serve, shakes, smoothies, soft bakes, and soups under the OPTAVIA, OPTAVIA ACTIVE, and Optimal Health brand names. The company markets its products through point-of-sale transactions, as well as through ecommerce platform. Medifast, Inc. was founded in 1980 and is headquartered in Baltimore, Maryland.
About Dermata Therapeutics
Dermata Therapeutics, Inc., a late-stage medical dermatology company, focuses on identifying, developing, and commercializing pharmaceutical product candidates for the treatment of medical and aesthetic skin conditions and diseases. The company's lead product candidate is DMT310, which has completed Phase IIb clinical trial for treatment of moderate-to-severe acne; and Phase Ib proof of concept (POC) trial for Mild-to-Moderate Psoriasis, as well as is in a Phase 2 clinical trial for treatment of moderate-to-severe rosacea. It is also developing DMT410 that has completed Phase Ib POC trials for the treatment of anxillary hyperhidrosis and aesthetic conditions. Dermata Therapeutics, Inc. was incorporated in 2014 and is headquartered in San Diego, California.
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