Shares of Castle Biosciences Inc. (NASDAQ: CSTL) jumped 67% over three months following InvestingPro’s identification of significant undervaluation, according to data released on Friday.
The diagnostics company, which specializes in cancer detection tools, was trading at $18.63 on May 12, when InvestingPro’s Preço-justo model assigned a fair-value estimate of $28.20—indicating a 51% upside potential. By early August, CSTL’s stock had reached $34.20, surpassing the initial fair-value target of $31.15 before continuing its upward trajectory.
The rally followed a 13.9% decline in May, during which the company’s market capitalization stood at $1.04 billion. Castle Biosciences reported Q2 2026 revenue of $357.28 million, up from $339.92 million in the prior period, while narrowing its EBITDA loss to $16.52 million from $18.35 million previously. Analysts at BTIG raised the price target in response to the revenue beat.
Regulatory progress also supported investor sentiment. The company secured approval in New York for its atopic dermatitis test and reached 100,000 orders for its Barrett’s esophagus diagnostic. Its melanoma test continued to outperform existing risk-assessment tools, reinforcing Castle Biosciences’ commercial momentum.
InvestingPro’s fair-value methodology aggregates discounted cash flow models, comparable company analysis, and analyst targets, applying a margin of safety to derive its intrinsic value estimates.
