Financial Analysis: CervoMed (NASDAQ:CRVO) vs. MusclePharm (OTCMKTS:MSLP)

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

Volatility and Risk

CervoMed has a beta of 0.21, suggesting that its share price is 79% less volatile than the S&P 500. Comparatively, MusclePharm has a beta of -0.07, suggesting that its share price is 107% less volatile than the S&P 500.

Earnings & Valuation

This table compares CervoMed and MusclePharm”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CervoMed	$7.14 million	10.35	-$2.17 million	($2.03)	-4.18
MusclePharm	$50.04 million	0.00	-$12.87 million	($0.58)	N/A

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

Institutional & Insider Ownership

25.1% of CervoMed shares are held by institutional investors. Comparatively, 15.5% of MusclePharm shares are held by institutional investors. 36.3% of CervoMed shares are held by company insiders. Comparatively, 60.7% of MusclePharm shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and price targets for CervoMed and MusclePharm, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CervoMed	1	1	5	2	2.89
MusclePharm	0	0	0	0	0.00

CervoMed presently has a consensus target price of $27.50, suggesting a potential upside of 223.91%. Given CervoMed’s stronger consensus rating and higher possible upside, equities analysts plainly believe CervoMed is more favorable than MusclePharm.

Profitability

This table compares CervoMed and MusclePharm’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CervoMed	-118.68%	-44.11%	-39.81%
MusclePharm	-38.51%	N/A	-169.56%

Summary

CervoMed beats MusclePharm on 8 of the 14 factors compared between the two stocks.

About CervoMed

CervoMed Inc., a biotechnology company, engages in the development and commercialization of treatments for age-related neurologic disorders. Its lead drug candidate is neflamapimod, an orally administered small molecule brain penetrant for the treatment of dementia with Lewy bodies (DLB), Alzheimer's diseases, frontotemporal dementia, and ischemic stroke recovery. The company also develops EIP200 for central nervous system which is in preclinical trials. CervoMed Inc. was founded in 2010 and is headquartered in Boston, Massachusetts.

About MusclePharm

MusclePharm Corporation develops, manufactures, markets, and distributes sports nutrition products and nutritional supplements in the United States and internationally. The company offers a range of performance powders, capsules, tablets, gels, and on-the-go ready to eat snacks. Its MusclePharm brand product portfolio includes combat protein powder and combat crunch protein bars; and essential supplements, such as a BCAA, creatine, glutamine, carnitine, CLA, fish oil, multi-vitamin, and other products. The company also provides FitMiss branded sports nutrition products, which are formulated primarily for the female body to support women in the areas of weight management, lean muscle mass, body composition, and general health and wellness; and functional energy beverages under the Combat Energy and FitMiss Energy brands. It sells its products to various athletes and fitness enthusiasts. The company was incorporated in 2006 and is based in Las Vegas, Nevada.