Verrica Pharmaceuticals (VRCA) AI Stock Analysis

• Market Cap: $33.34M
• Dividend Yield: N/A
• Average Volume (3M): 544.61K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.92
• Revenue Growth: 5.72%
• EPS Growth: 55.79%
• Country: US
• Employees: 71
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): 0.02
• Shares Outstanding: 9,445,768
• 10 Day Avg. Volume: 417,535
• 30 Day Avg. Volume: 544,605
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 2.21
• Enterprise Value/Revenue: 5.02
• Enterprise Value/Gross Profit: 5.73
• Enterprise Value/Ebitda: -1.88
• 1Y Price Target: $20.00
• Price Target Upside: 466.57% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 43 Neutral
• Price Target: $3.50 ▼(-0.85% Downside)

Verrica Pharmaceuticals' overall stock score is primarily impacted by its poor financial performance and valuation. Despite positive developments in the latest earnings call, including growth in YCANTH sales and strategic partnerships, the company's financial instability and bearish technical indicators weigh heavily on the score.

Positive Factors

Revenue Growth

The significant increase in revenue indicates successful product adoption and market penetration, which are critical for long-term growth and sustainability.

Strategic Partnerships

The partnership with Torii Pharmaceutical enhances Verrica's global reach and financial stability, supporting future growth and development initiatives.

Operational Cost Management

Effective cost management improves profitability and resource allocation, allowing for reinvestment into growth areas and enhancing financial health.

Negative Factors

Financial Instability

Negative equity and high leverage indicate financial distress, posing risks to long-term solvency and limiting the company's ability to invest in growth.

Cash Flow Concerns

Insufficient cash flow threatens operational continuity, necessitating external funding, which could dilute shareholder value or increase financial liabilities.

Declining R&D Investment

Reduced R&D spending may hinder future product development and innovation, impacting the company's competitive edge and long-term growth potential.

Verrica Pharmaceuticals Business Overview & Revenue Model

Company Description

Verrica Pharmaceuticals Inc., a dermatology therapeutics company, develops and commercializes treatments for people with skin diseases in the United States. The company's lead product candidate includes VP-102 for the treatment of molluscum contagiosum; that has completed Phase II clinical trial for the treatment of external genital warts; and which is in Phase II clinical trial for treating common warts. It is also developing cantharidin-based product candidate, VP-103 for treating plantar warts. The company has a license and collaboration agreement with Torii Pharmaceutical Co., Ltd. for the development and commercialization of its product candidates for the treatment of molluscum contagiosum and common warts in Japan, including VP-102; and a license agreement with Lytix Biopharma AS to develop and commercialize LTX-315 for dermatological oncology indications. Verrica Pharmaceuticals Inc. was incorporated in 2013 and is headquartered in West Chester, Pennsylvania.

How the Company Makes Money

Verrica Pharmaceuticals generates revenue primarily through the commercialization of its therapeutic products, particularly once they receive regulatory approval. The company may also generate income from collaborations and partnerships with larger pharmaceutical companies that seek to co-develop or market its products. Revenue streams include product sales, milestone payments from partnerships, and potentially royalties from sales of partnered products. As the company advances its pipeline candidates, successful product launches and market penetrations will be critical factors contributing to its earnings.

Verrica Pharmaceuticals Financial Statement Overview

Summary

Verrica Pharmaceuticals is experiencing significant financial challenges with persistent losses, declining revenues, and negative equity. The company is highly leveraged with negative cash flows, posing substantial risks to its financial health.

Income Statement

Verrica Pharmaceuticals shows a declining revenue trend over recent years, with total revenue dropping from $12 million in 2021 to $7.57 million in 2024. The company has been consistently operating at a loss, with a negative EBIT and net profit margin, which are concerning for long-term profitability. Despite a slight increase in revenue from 2023 to 2024, the overall trend reveals financial instability and high operational expenses relative to revenue.

Balance Sheet

The balance sheet reveals significant financial instability, with a negative stockholders' equity in 2024, indicating that liabilities exceed assets. The debt-to-equity ratio is undefined due to negative equity, signaling high leverage and potential solvency issues. The equity ratio is also negative, further highlighting financial distress and the risk of insolvency.

Cash Flow

Verrica Pharmaceuticals faces persistent negative operating and free cash flows, with operating cash flow deteriorating significantly from 2023 to 2024. The free cash flow to net income ratio is unfavorable, indicating insufficient cash generation to cover losses. Although financing cash flows have been positive, they are primarily used to cover operational deficits rather than growth investments.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	14.70M	7.57M	5.12M	9.03M	12.00M	0.00
Gross Profit	12.88M	5.71M	4.38M	8.31M	11.53M	-229.00K
EBITDA	-39.34M	-65.90M	-62.20M	-21.60M	-30.31M	-39.43M
Net Income	-48.60M	-76.58M	-67.00M	-24.49M	-35.08M	-45.50M
Balance Sheet
Total Assets	39.11M	54.13M	81.60M	44.72M	80.13M	74.15M
Cash, Cash Equivalents and Short-Term Investments	15.40M	46.33M	69.55M	34.27M	70.35M	65.47M
Total Debt	38.89M	45.94M	45.51M	1.53M	43.41M	37.21M
Total Liabilities	56.59M	63.99M	61.83M	4.69M	47.52M	41.17M
Stockholders Equity	-17.48M	-9.86M	19.76M	40.03M	32.60M	32.99M
Cash Flow
Free Cash Flow	-47.36M	-60.95M	-38.94M	-18.95M	-28.46M	-31.68M
Operating Cash Flow	-47.34M	-60.93M	-38.58M	-18.65M	-27.58M	-30.21M
Investing Cash Flow	-8.00K	-19.00K	-362.00K	54.04M	-998.00K	-3.58M
Financing Cash Flow	30.82M	37.73M	74.21M	-16.87M	33.65M	35.23M

Verrica Pharmaceuticals Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.53
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VRCA, the sentiment is Negative. The current price of 3.53 is below the 20-day moving average (MA) of 4.11, below the 50-day MA of 4.58, and below the 200-day MA of 5.72, indicating a bearish trend. The MACD of -0.28 indicates Positive momentum. The RSI at 30.37 is Neutral, neither overbought nor oversold. The STOCH value of 6.86 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for VRCA.

Verrica Pharmaceuticals Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EVAX	―	$36.38M	―	―	―	4455.07%	77.31%
Sector *	―	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
GBIO	―	$41.09M	-0.56	-85.45%	―	61.15%	54.71%
ELUT	―	$37.76M	―	―	―	-5.22%	82.06%
LVTX	―	$38.93M	―	-90.07%	―	-32.55%	-15.83%
VRCA	―	$33.34M	―	―	―	5.72%	55.79%

Verrica Pharmaceuticals Corporate Events

Verrica Pharmaceuticals’ Earnings Call Highlights Growth and Strategic Moves

Verrica Pharmaceuticals’ recent earnings call conveyed a positive sentiment, highlighting significant growth in YCANTH sales, strategic partnerships, and improved financial performance. However, the company acknowledged concerns regarding future cash flow and a reduction in research and development expenses.

Verrica Pharmaceuticals Sees Revenue Surge in Q2 2025

Verrica Pharmaceuticals Inc. is a dermatology therapeutics company focused on developing and commercializing treatments for skin diseases requiring medical interventions, with its flagship product YCANTH® being the first FDA-approved treatment for molluscum contagiosum.

Verrica Pharmaceuticals Regains Nasdaq Compliance

On August 8, 2025, Verrica Pharmaceuticals announced it had regained compliance with Nasdaq listing requirements. The company reported $12.7 million in revenue for Q2 2025, driven by strong growth in YCANTH sales and milestone payments from Torii Pharmaceutical. Verrica is preparing for a Phase 3 program for VP-315 for basal cell carcinoma and anticipates further growth through strategic partnerships and regulatory approvals. A reverse stock split was also effected on July 24, 2025, reducing the number of shares outstanding.

The most recent analyst rating on (VRCA) stock is a Buy with a $120.00 price target. To see the full list of analyst forecasts on Verrica Pharmaceuticals stock, see the VRCA Stock Forecast page.