Head-To-Head Analysis: Acerus Pharmaceuticals (OTCMKTS:TRLPF) & DURECT (NASDAQ:DRRX)

Acerus Pharmaceuticals (OTCMKTS:TRLPF) and DURECT (NASDAQ:DRRX) are both small-cap medical companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, institutional ownership, risk, analyst recommendations and valuation.

Analyst Recommendations

This is a summary of recent ratings and target prices for Acerus Pharmaceuticals and DURECT, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Acerus Pharmaceuticals	0	0	0	0	0.00
DURECT	0	1	1	0	2.50

DURECT has a consensus target price of $5.00, suggesting a potential upside of 415.46%. Given DURECT’s stronger consensus rating and higher probable upside, analysts plainly believe DURECT is more favorable than Acerus Pharmaceuticals.

Valuation & Earnings

This table compares Acerus Pharmaceuticals and DURECT”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Acerus Pharmaceuticals	$7.38 million	7.71	-$18.79 million	($0.08)	-2.75
DURECT	$8.59 million	3.50	-$27.62 million	($0.61)	-1.59

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

Institutional & Insider Ownership

0.0% of Acerus Pharmaceuticals shares are held by institutional investors. Comparatively, 28.0% of DURECT shares are held by institutional investors. 3.2% of DURECT shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Acerus Pharmaceuticals and DURECT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Acerus Pharmaceuticals	-254.66%	-346.72%	-94.54%
DURECT	-198.58%	-300.62%	-65.17%

Volatility & Risk

Acerus Pharmaceuticals has a beta of 2.6, meaning that its share price is 160% more volatile than the S&P 500. Comparatively, DURECT has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500.

Summary

DURECT beats Acerus Pharmaceuticals on 10 of the 14 factors compared between the two stocks.

About Acerus Pharmaceuticals

Acerus Pharmaceuticals Corporation, a specialty pharmaceutical company, focuses on the development, manufacture, marketing, and distribution of pharmaceutical products for men's and women's health. The company offers Natesto, a nasal gel for testosterone replacement therapy in adult males diagnosed with hypogonadism; Estrace, an oral tablet for the symptomatic relief of menopausal symptoms; and UriVarx, a natural health product that helps reduce symptoms of hyperactive bladder, such as daytime urinary frequency, urgency, and nocturia. It also engages in developing Lidbree, a short acting lidocaine formulation delivered through a proprietary device into the vaginal mucosal tissue; Stendra, a PDE5 inhibitor for the treatment of erectile dysfunction; Elegant vaginal moisturizer, which provides comfort to women suffering from vaginal dryness; and Elegant pH, a pH balanced vaginal product; Gynoflor, an ultra-low dose vaginal estrogen combined with a probiotic for the treatment of vaginal atrophy, restoration of vaginal flora, and treatment of certain vaginal infections; and Tefina, a clinical stage product for women with female sexual dysfunction. Acerus Pharmaceuticals Corporation sells products through its salesforce in Canada; and through a network of licensed distributors in the United States and internationally. The company was formerly known as Trimel Pharmaceuticals Corporation and changed its name to Acerus Pharmaceuticals Corporation in September 2015. Acerus Pharmaceuticals Corporation was founded in 2008 and is headquartered in Mississauga, Canada.

About DURECT

DURECT Corporation, a biopharmaceutical company, develops medicines based on its epigenetic regulator program. The company's lead product larsucosterol (DUR-928), an endogenous, orally bioavailable small molecule that is in Phase IIb clinical trial to play a regulatory role in lipid metabolism, stress and inflammatory responses, and cell death and survival to treat alcohol-associated hepatitis, as well as completed Phase Ib clinical trial to treat patients with nonalcoholic steatohepatitis. It also offers ALZET product line that consists of osmotic pumps and accessories used for research in mice, rats, and other laboratory animals. In addition, the company offers POSIMIR, a post-surgical pain product to deliver bupivacaine over three days in adults; and Methydur to treat attention deficit hyperactivity disorder. It markets and sells its ALZET lines through direct sales force in the United States, as well as through a network of distributors in other countries. The company has strategic collaboration and other agreements with Virginia Commonwealth University Intellectual Property Foundation; Indivior UK Ltd.; and Innocoll Pharmaceuticals Limited. DURECT Corporation was incorporated in 1998 and is headquartered in Cupertino, California.