Financial Analysis: Castle Biosciences (NASDAQ:CSTL) vs. Brookdale Senior Living (NYSE:BKD)

Castle Biosciences (NASDAQ:CSTL) and Brookdale Senior Living (NYSE:BKD) are both healthcare companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, earnings, dividends, risk, analyst recommendations and institutional ownership.

Profitability

This table compares Castle Biosciences and Brookdale Senior Living’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Castle Biosciences	-6.10%	-4.89%	-4.06%
Brookdale Senior Living	-1.27%	-15,050.32%	-0.53%

Insider & Institutional Ownership

92.6% of Castle Biosciences shares are held by institutional investors. 6.1% of Castle Biosciences shares are held by insiders. Comparatively, 0.7% of Brookdale Senior Living shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility & Risk

Castle Biosciences has a beta of 1, indicating that its share price has a similar volatility profile to the S&P 500.Comparatively, Brookdale Senior Living has a beta of 0.55, indicating that its share price is 45% less volatile than the S&P 500.

Valuation & Earnings

This table compares Castle Biosciences and Brookdale Senior Living”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Castle Biosciences	$377.13 million	2.74	-$24.16 million	($0.77)	-43.58
Brookdale Senior Living	$2.95 billion	0.74	-$262.69 million	($0.16)	-57.16

Castle Biosciences has higher earnings, but lower revenue than Brookdale Senior Living. Brookdale Senior Living is trading at a lower price-to-earnings ratio than Castle Biosciences, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Castle Biosciences and Brookdale Senior Living, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Castle Biosciences	1	1	8	1	2.82
Brookdale Senior Living	2	0	6	0	2.50

Castle Biosciences presently has a consensus target price of $46.50, suggesting a potential upside of 38.56%. Brookdale Senior Living has a consensus target price of $15.60, suggesting a potential upside of 70.59%. Given Brookdale Senior Living’s higher possible upside, analysts clearly believe Brookdale Senior Living is more favorable than Castle Biosciences.

Summary

Castle Biosciences beats Brookdale Senior Living on 10 of the 15 factors compared between the two stocks.

About Castle Biosciences

Castle Biosciences, Inc. is a molecular diagnostics company that develops and commercializes tests intended to help physicians make personalized treatment and care decisions. Its tests analyze biological features of tissue to provide information about disease behavior and patient risk. The company’s portfolio includes DecisionDx tests for conditions such as cutaneous melanoma, cutaneous squamous cell carcinoma and uveal melanoma. It also offers TissueCypher, a test designed to assess progression risk in patients with Barrett’s esophagus.

About Brookdale Senior Living

Brookdale Senior Living Inc. operates senior living communities in the United States, serving older adults with a range of housing and care options. Its offerings include independent living, assisted living and memory care, with services tailored to residents’ needs and levels of independence. Community services may include meals, housekeeping, transportation, wellness programs and social activities, alongside personal assistance and specialized support for residents with memory-related conditions.