GET DAILY SIGNALSStarling Oncology (STLN) Delivers Q3 Revenue Growth of 24.3% With Adjusted EBITDA Turning Positive
Key Takeaways
- Third quarter 2026 revenue rose 24.3% year over year to $169.8 million, narrowly topping consensus estimates near $168.7 million.
- Net loss narrowed to $15.7 million, or $0.13 per share, from $16.5 million, or $0.14 per share, a year earlier, but the loss was wider than the roughly $0.05–$0.07 per share analysts had modeled.
- Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) turned positive at $3.4 million, a second consecutive quarter in positive territory and above management's outlook.
- Specialty pharmacy revenue climbed 44% year over year to $109.3 million, with segment gross margin reaching 24.2%.
- Capitated revenue increased 40% year over year to $28.7 million, while the Medical Loss Ratio (MLR) for capitated contracts rose to 81.0% from 67.8%.
- Full-year 2026 revenue guidance was tightened to $650–$660 million, with the top end trimmed from the prior $650–$670 million range.
Why These Results Matter for Starling Oncology
Starling Oncology, formerly The Oncology Institute, operates more than 100 clinics across five states as one of the larger value-based oncology groups in the United States. The third-quarter 2026 report, for the period ended September 30, 2026, represents the first full quarter under the new STLN ticker after the August rebrand. These numbers test the strength of the company’s growth drivers, especially the specialty pharmacy business and the capitated care model. Investors continue to focus on the path to profitability, where management has highlighted adjusted EBITDA positivity and better free cash flow as important steps in a competitive oncology sector.
A Closer Look at the Reported Numbers
STLN posted total revenue of $169.8 million for the third quarter, up 24.3% from $136.6 million a year earlier and slightly ahead of consensus. Patient services revenue reached $60.0 million, or 35.4% of the total. Within that, capitated revenue grew 39.5% to $28.7 million, while fee-for-service revenue fell 21% to $31.3 million, partly due to contract shifts that replaced some drug carve-outs with per-member-per-month adjustments.
Specialty pharmacy stood out again, delivering $109.3 million in revenue, a 44% year-over-year increase, with a gross margin of 24.2%. Overall gross profit rose to $30.7 million from $18.9 million, lifting the gross margin to 18.1% from 13.9%. The net loss narrowed to $15.7 million, or $0.13 per share, from $16.5 million, or $0.14 per share. Adjusted EBITDA came in at $3.4 million, beating the company’s own guidance range of $0.5 million to $1.5 million. The MLR for capitated contracts increased to 81.0% from 67.8%, while nine-month free cash flow moved to positive $20.2 million from negative $26.9 million. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
How the Market Reacted
Heading into the release, sentiment was positive on the back of strong revenue growth and improving profitability, with shares having advanced sharply year to date. The post-earnings response has been more measured. Revenue and adjusted EBITDA both came in ahead of expectations, yet the wider-than-forecast per-share loss and the trimmed upper end of full-year revenue guidance added a note of caution. The higher MLR and management’s 85–90% expectation for 2027 as new patients are added also tempered enthusiasm around the capitated segment, balancing optimism on pharmacy momentum with near-term profitability questions.
Outlook and Items to Watch
Starling kept its overall 2026 framework but made targeted adjustments. It narrowed adjusted EBITDA guidance to $4–$6 million and lowered the top end of revenue guidance to $650–$660 million while raising the low end of gross profit expectations. Fourth-quarter adjusted EBITDA is now guided to $3–$5 million, with full-year free cash flow expected between $5 million and $10 million.
Looking ahead, specialty pharmacy margins are likely to normalize. Management noted that certain favorable rebates and drug-price movements are unlikely to repeat, pointing to pharmacy gross margins in the high teens going forward. The Inflation Reduction Act is expected to affect additional oral drugs in 2027, though the company sees limited revenue and margin impact. New capitated patient onboarding, including entry into a new state, should push the MLR higher next year, a factor that will be watched against the goal of sustained adjusted EBITDA positivity and continued growth.
Refining Research With AI Tools
I recently used Tickeron’s AI Screener to scan for comparable oncology and healthcare names with similar growth and margin profiles. The tool helped surface a short list of peers based on technical patterns and fundamentals, which gave useful context when evaluating STLN alongside broader sector trends. It is a straightforward way to add another layer of data to the usual earnings review.
Disclaimer
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Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
STLN in +11.04% Uptrend, growing for three consecutive days on November 04, 2026
Moving higher for three straight days is viewed as a bullish sign. Keep an eye on this stock for future growth. Considering data from situations where STLN advanced for three days, in 258 of 295 cases, the price rose further within the following month. The odds of a continued upward trend are 87%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. 48 of 58 cases where STLN's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 83%.
The Momentum Indicator moved above the 0 level on November 04, 2026. You may want to consider a long position or call options on STLN as a result. In 64 of 74 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 86%.
STLN moved above its 50-day moving average on November 04, 2026 date and that indicates a change from a downward trend to an upward trend.
Bearish Trend Analysis
The Moving Average Convergence Divergence Histogram (MACD) for STLN turned negative on October 26, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 37 similar instances when the indicator turned negative. In 34 of the 37 cases the stock turned lower in the days that followed. This puts the odds of success at 90%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where STLN declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 89%.
Fundamental Analysis (Ratings)
The Tickeron Valuation Rating of 12 (best 1 - 100 worst) indicates that the company is seriously undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (-27.408) is normal, around the industry mean (204.059). P/E Ratio (-23.103) is within average values for comparable stocks, (18.581). Projected Growth (PEG Ratio) (0.000) is also within normal values, averaging (2.498). Dividend Yield (0.000) settles around the average of (0.091) among similar stocks. P/S Ratio (1.124) is also within normal values, averaging (2.688).
The Tickeron Price Growth Rating for this company is 37 (best 1 - 100 worst), indicating steady price growth. STLN’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 78 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is 100 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is 100 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. STLN’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 82, placing this stock worse than average.
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