Head to Head Review: Castle Biosciences (NASDAQ:CSTL) and Option Care Health (NASDAQ:OPCH)
by Renee Jackson · The Cerbat GemOption Care Health (NASDAQ:OPCH – Get Free Report) and Castle Biosciences (NASDAQ:CSTL – Get Free Report) are both healthcare companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, profitability, analyst recommendations, valuation, institutional ownership, risk and dividends.
Valuation and Earnings
This table compares Option Care Health and Castle Biosciences”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Option Care Health | $5.69 billion | 0.62 | $207.59 million | $1.33 | 17.76 |
| Castle Biosciences | $357.28 million | 2.94 | -$24.16 million | ($0.66) | -52.09 |
Option Care Health has higher revenue and earnings than Castle Biosciences. Castle Biosciences is trading at a lower price-to-earnings ratio than Option Care Health, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Option Care Health has a beta of 0.61, suggesting that its share price is 39% less volatile than the S&P 500. Comparatively, Castle Biosciences has a beta of 0.99, suggesting that its share price is 1% less volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of recent ratings and recommmendations for Option Care Health and Castle Biosciences, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Option Care Health | 0 | 7 | 7 | 0 | 2.50 |
| Castle Biosciences | 1 | 1 | 7 | 1 | 2.80 |
Option Care Health currently has a consensus target price of $29.92, indicating a potential upside of 26.69%. Castle Biosciences has a consensus target price of $42.00, indicating a potential upside of 22.16%. Given Option Care Health’s higher probable upside, analysts plainly believe Option Care Health is more favorable than Castle Biosciences.
Profitability
This table compares Option Care Health and Castle Biosciences’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Option Care Health | 3.68% | 18.74% | 7.25% |
| Castle Biosciences | -5.43% | -4.15% | -3.45% |
Institutional & Insider Ownership
98.1% of Option Care Health shares are held by institutional investors. Comparatively, 92.6% of Castle Biosciences shares are held by institutional investors. 1.7% of Option Care Health shares are held by insiders. Comparatively, 6.1% of Castle Biosciences shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Summary
Option Care Health beats Castle Biosciences on 9 of the 14 factors compared between the two stocks.
About Option Care Health
Option Care Health, Inc. offers home and alternate site infusion services in the United States. The company provides anti-infective therapies; home infusion services to treat heart failures; home parenteral nutrition and enteral nutrition support services for numerous acute and chronic conditions, such as stroke, cancer, and gastrointestinal diseases; immunoglobulin infusion therapies for the treatment of immune deficiencies; and treatments for chronic inflammatory disorders, including crohn’s disease, plaque psoriasis, psoriatic arthritis, rheumatoid arthritis, ulcerative colitis, and other chronic inflammatory disorders. It also offers treatments to manage the progression of neurological disorders, such as multiple sclerosis, duchenne muscular dystrophy, and other neurological disorder; infusion therapies for bleeding disorders, such as hemophilia and von Willebrand diseases; therapies for women with high-risk pregnancies; and other infusion therapies to treat various conditions, including pain management, chemotherapy, and respiratory medications, as well as nursing services. The company markets its services through patient referrals, including physicians, hospital discharge planners, hospital personnel, health maintenance organizations, and preferred provider organizations. Option Care Health, Inc. is headquartered in Bannockburn, Illinois.
About Castle Biosciences
Castle Biosciences, Inc., a molecular diagnostics company, provides testing solutions for the diagnosis and treatment of dermatologic cancers, Barrett's esophagus, uveal melanoma, and mental health conditions. It offers DecisionDx-Melanoma, a risk stratification gene expression profile (GEP) test to identify the risk of metastasis for patients diagnosed with invasive cutaneous melanoma; DecisionDx-SCC, a proprietary risk stratification GEP test for patients with cutaneous squamous cell carcinoma; MyPath Melanoma, a test used for patients with difficult-to-diagnose melanocytic lesions; and TissueCypher, a spatial omics test to predict future development of high-grade dysplasia and/or esophageal cancer in patients with non-dysplastic, indefinite dysplasia, or low-grade dysplasia Barrett's esophagus. In addition, the company provides DecisionDx-UM test, a proprietary risk stratification GEP test that predicts the risk of metastasis for patients with uveal melanoma; and IDgenetix, a pharmacogenomic test that helps guide drug treatment for major depressive disorder, schizophrenia, bipolar disorder, anxiety disorders, social phobia, obsessive-compulsive personality disorder, post-traumatic stress disorder, and attention deficit hyperactivity disorder. It offers its products to skin cancer, gastroenterology, and mental health markets. The company was incorporated in 2007 and is headquartered in Friendswood, Texas.