Reviewing Option Care Health (NASDAQ:OPCH) and Castle Biosciences (NASDAQ:CSTL)

Castle Biosciences (NASDAQ:CSTL) and Option Care Health (NASDAQ:OPCH) are both healthcare companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.

Risk & Volatility

Castle Biosciences has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500. Comparatively, Option Care Health has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500.

Earnings & Valuation

This table compares Castle Biosciences and Option Care Health”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Castle Biosciences	$344.23 million	2.92	-$24.16 million	($0.66)	-49.86
Option Care Health	$5.65 billion	0.64	$207.59 million	$1.33	18.20

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.

Profitability

This table compares Castle Biosciences and Option Care Health’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Castle Biosciences	-5.43%	-4.15%	-3.45%
Option Care Health	3.68%	18.74%	7.25%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Castle Biosciences and Option Care Health, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Castle Biosciences	1	1	7	1	2.80
Option Care Health	1	6	7	0	2.43

Castle Biosciences currently has a consensus target price of $42.00, indicating a potential upside of 27.62%. Option Care Health has a consensus target price of $29.92, indicating a potential upside of 23.60%. Given Castle Biosciences’ stronger consensus rating and higher possible upside, analysts clearly believe Castle Biosciences is more favorable than Option Care Health.

Insider and Institutional Ownership

92.6% of Castle Biosciences shares are held by institutional investors. Comparatively, 98.0% of Option Care Health shares are held by institutional investors. 6.1% of Castle Biosciences shares are held by insiders. Comparatively, 1.7% of Option Care Health shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Option Care Health beats Castle Biosciences on 8 of the 14 factors compared between the two stocks.

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.

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.