Contrasting Castle Biosciences (NASDAQ:CSTL) & Acadia Healthcare (NASDAQ:ACHC)

Acadia Healthcare (NASDAQ:ACHC) and Castle Biosciences (NASDAQ:CSTL) are both healthcare companies, but which is the better investment? We will compare the two companies based on the strength of their risk, dividends, earnings, profitability, valuation, analyst recommendations and institutional ownership.

Earnings & Valuation

This table compares Acadia Healthcare and Castle Biosciences”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Acadia Healthcare	$3.31 billion	0.79	-$1.10 billion	($12.45)	-2.25
Castle Biosciences	$357.28 million	2.86	-$24.16 million	($0.66)	-50.67

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

Volatility and Risk

Acadia Healthcare has a beta of 0.62, suggesting that its share price is 38% 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 Ratings

This is a breakdown of recent ratings and target prices for Acadia Healthcare and Castle Biosciences, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Acadia Healthcare	2	5	7	1	2.47
Castle Biosciences	1	1	7	1	2.80

Acadia Healthcare currently has a consensus price target of $29.85, suggesting a potential upside of 6.59%. Castle Biosciences has a consensus price target of $42.00, suggesting a potential upside of 25.60%. Given Castle Biosciences’ stronger consensus rating and higher probable upside, analysts plainly believe Castle Biosciences is more favorable than Acadia Healthcare.

Profitability

This table compares Acadia Healthcare and Castle Biosciences’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Acadia Healthcare	-33.44%	6.19%	2.42%
Castle Biosciences	-5.43%	-4.15%	-3.45%

Insider and Institutional Ownership

92.6% of Castle Biosciences shares are owned by institutional investors. 1.2% of Acadia Healthcare shares are owned by insiders. Comparatively, 6.1% of Castle Biosciences shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Castle Biosciences beats Acadia Healthcare on 9 of the 13 factors compared between the two stocks.

About Acadia Healthcare

Acadia Healthcare Company, Inc. provides behavioral healthcare services in the United States and Puerto Rico. The company develops and operates acute inpatient psychiatric facilities, specialty treatment facilities comprising residential recovery facilities and eating disorder facilities, comprehensive treatment centers, and residential treatment centers, as well as facilities offering outpatient behavioral healthcare services for the behavioral healthcare and recovery needs of communities. Acadia Healthcare Company, Inc. was founded in 2005 and is headquartered in Franklin, Tennessee.

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.