BTIG analyst Mark Massaro has reiterated their bullish stance on CSTL stock, giving a Buy rating yesterday.
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Mark Massaro has given his Buy rating due to a combination of factors that highlight Castle Biosciences’ strong financial performance and growth potential. The company reported a significant revenue beat in the third quarter, surpassing expectations with a 17% increase in topline growth and raising its full-year outlook. This growth is driven by the impressive performance of its TissueCypher test, which saw a 75% year-over-year increase, and the company’s industry-leading gross margins of 77%.
Additionally, Castle Biosciences is making strategic moves to enhance its market position, including filing for reconsideration of Medicare reimbursement for its SCC test, which could provide further upside. The launch of the new Advance AD-Tx test for atopic dermatitis represents a significant market opportunity, with a total addressable market estimated at $33 billion. Furthermore, the stock is trading at a relatively low multiple compared to its peers, suggesting potential for valuation expansion. These factors collectively support the Buy rating and the increased price target from $32 to $38.
In another report released yesterday, Robert W. Baird also maintained a Buy rating on the stock with a $41.00 price target.
Based on the recent corporate insider activity of 50 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of CSTL in relation to earlier this year.