Forensic Analysis · Healthcare / Pharmaceuticals / Biotech · as of Aug 30, 2026

Verrica Pharmaceuticals Inc. (VRCA)

A forensic read on Verrica Pharmaceuticals Inc. built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.

F · Poor — capital at risk

Forensic grade

Distress

Financial health

-19.4

Distress distance

Watch

Earnings quality

Forensic signals

-72.3%

ROE

370.2%

Revenue growth

The financial-health reading above compares this company's equity at BOOK value, not at what the market currently pays for it — this free snapshot doesn't pull live market data. Treat it as a rough read, not the final word.

This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (red flags, auditor quality, say on pay, board independence). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.

Verrica Pharmaceuticals Inc. earns an F (Poor — capital at risk) forensic quality grade, and its balance-sheet distress test reads -19.4, placing it in the Distress zone (based on book value, not market value, since this free snapshot doesn't pull live market data — treat this zone as a rough read, not the final word). 3 forensic signals were flagged in its latest SEC filings, led by return on invested capital.

What the filings flag

-1759.8%

FY2025

Return on invested capital. Return on invested capital is -1759.8% in the latest fiscal year and slipping from -54% — below its ~10% cost of capital. If that gap persists through the cycle, incremental reinvestment reduces rather than creates value per share.

9% of rev

FY2025

Stock-based comp load. Stock-based compensation ran 9% of revenue in FY2025 — about $0.31 per diluted share. No cash left the business to pay it, which is why operating cash flow adds it back. Net of repurchases the diluted count still rose about 29.5% a year and that rate is not falling, so total profit has to grow by that much annually before any of it reaches a share. Stock compensation is one source of that issuance; acquisition consideration, equity raises, convertibles and other employee plans also net into the count, and these figures do not separate them.

n/m (stock split)

FY2022–FY2025

Share count (stock split). Diluted share count changed -69% over the last 3 years to FY2025, but that includes a large one-time change around FY2024 consistent with a stock split or reverse split, not gradual buybacks or issuance — a split changes the count with NO effect on any holder's proportional ownership, so the raw -32.2%/yr figure isn't a real buyback/dilution read here.

Key fundamentals

Latest Revenue$35.6M

Revenue Growth YoY+370.2%

Revenue CAGR (3yr)+57.9%

Net Margin-50.3%

Free Cash Flow-$17.6M

Return on Equity-72.3%

Debt / Equity0.00x

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Data from SEC EDGAR public filings · metrics as of Aug 30, 2026. Forensic signals flag probability, not certainty.