Verrica Pharmaceuticals Inc. (NASDAQ:VRCA) has reported that its President and CEO, Ted White, sold a total of 32,623 shares of company stock over two consecutive days. The transactions, which were disclosed in a recent SEC filing, amounted to over $230,000 in total value.
On July 22, 2024, White sold 32,469 shares at an average price of $7.06 per share, while on the following day, he sold an additional 154 shares at a price of $6.98 each. These sales were part of a "sell to cover" transaction mandated by the company's 2018 equity incentive plan to satisfy minimum statutory tax withholding obligations connected to the settlement of restricted stock units. According to the filing, these sales were not discretionary.
The weighted average price for the shares sold on July 22 was reported to be within a range from $7.00 to $7.17. The SEC filing included a footnote indicating that the CEO is willing to provide full information regarding the number of shares sold at each separate price upon request.
Following these transactions, White still owns a substantial amount of Verrica Pharmaceuticals stock, with 249,967 shares remaining in his possession. The sales took place under circumstances that are commonly seen in executive compensation structures, where shares are sold to cover tax obligations triggered by the vesting of equity awards.
Investors and followers of Verrica Pharmaceuticals Inc. often monitor insider transactions as they may provide insights into executives' perspectives on the company's current valuation and future prospects.
In other recent news, Verrica Pharmaceuticals has announced a settlement with Dormer Laboratories, leading to the cessation of all Dormer Labs' cantharidin-containing products sales in the United States. The only FDA-approved cantharidin therapy for molluscum contagiosum, a contagious skin disease, is Verrica's YCANTH. Additionally, Verrica has amended its Credit Agreement, adjusting the revenue test commencement date to September 30, 2024, which affects the requirement for principal payments on the borrowings based on YCANTH's performance.
Moving forward, Verrica, in collaboration with Torii Pharmaceutical Co. Ltd., has revised its licensing agreement to conduct a global Phase 3 clinical trial for YCANTH, a treatment for common warts. This trial is expected to commence in the first half of 2025. Verrica reported $3.2 million in net revenues from YCANTH in the first quarter of 2024.
Analyst firms Jefferies and H.C. Wainwright have both recently upgraded their price targets for Verrica Pharmaceuticals, citing strong YCANTH prescription growth and sales performance. Jefferies anticipates significant revenue growth, while H.C. Wainwright has revised its expectations for YCANTH sales and Verrica's operating margins for the year 2025 and beyond. These are some of the latest developments for Verrica Pharmaceuticals.
InvestingPro Insights
As Verrica Pharmaceuticals Inc. (NASDAQ:VRCA) navigates through a period marked by the insider transactions of its CEO, Ted White, the company's financial health and market performance come into focus. According to recent data from InvestingPro, Verrica has a market capitalization of $313.91 million and a notably high Price / Book ratio of 210.98 as of the last twelve months leading up to Q1 2024. This ratio points to a market valuation significantly above the company's book value, which could suggest investor confidence or a premium for potential growth or intellectual property not captured on the balance sheet.
Despite a revenue growth of over 10240% in Q1 2024 compared to the same quarter in the previous year, the company's gross profit margin has been deeply negative at -172.86%, indicating that Verrica has been spending more to produce its goods than it's making from sales. Moreover, the company's price has seen a large uptick over the last six months, with a 29.31% return, yet it is trading at a high revenue valuation multiple, which could be a point of concern for value-focused investors.
InvestingPro Tips highlight several critical aspects for investors to consider. Analysts do not anticipate Verrica will be profitable this year, and there has been a significant downward revision of earnings for the upcoming period by three analysts. These insights are crucial for understanding the broader context in which the CEO's stock sale occurred, potentially reflecting a complex financial landscape for the company.
For investors seeking a deeper dive into Verrica Pharmaceuticals' financials and stock performance, InvestingPro offers additional insights. There are 13 more InvestingPro Tips available that could provide a more nuanced understanding of the company's financial health and market position. Interested readers can use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription for more detailed analysis and metrics.
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