Tempus AI (NASDAQ:TEM) Stock Sees Unusually High Call Option Buying

Key Points

• Unusually heavy call-option activity lifted bullish interest in Tempus AI, with 34,007 calls purchased—about 11% above average volume.
• Tempus AI reported adjusted earnings of $0.07 per share versus expectations for a $0.09 loss, while revenue rose 23.1% year over year to $411.5 million. Shares climbed 8.7% to $78.48 on unusually high trading volume.
• Analyst sentiment has improved, including higher price targets from several firms, but the stock remains unprofitable on a GAAP basis and insiders have recently sold substantial shares, presenting risks despite the strong rally.

Tempus AI, Inc. (NASDAQ:TEM - Get Free Report) was the recipient of unusually large options trading activity on Monday. Investors purchased 34,007 call options on the company. This represents an increase of approximately 11% compared to the average volume of 30,644 call options.

More Tempus AI News

Here are the key news stories impacting Tempus AI this week:

• Positive Sentiment: Earnings beat expectations: Tempus reported adjusted earnings of $0.07 per share, compared with analyst estimates for a $0.09 loss. Revenue increased 23.1% year over year to approximately $411.5 million, narrowly exceeding consensus. The result also marked a significant improvement from the prior-year loss. Tempus AI Beats Q3 Earnings and Revenue Estimates
• Positive Sentiment: High-growth business lines supported margins: Data and Applications revenue grew 33%, with gross margins above 71%. Management maintained an adjusted EBITDA outlook of roughly $65 million, implying substantial expected EBITDA growth in the fourth quarter. Tempus AI Revenue Up 23%; Gains Cut Net Loss
• Positive Sentiment: Analyst support strengthened: Needham raised its price target from $75 to $89 and reiterated a Buy rating, suggesting continued confidence in Tempus AI’s growth prospects. Needham Analyst Ratings
• Positive Sentiment: Unusually heavy call-option activity and Cathie Wood’s reported purchase of Tempus AI shares added to bullish trading interest, although these signals do not guarantee continued gains. Cathie Wood Buys Tempus AI Shares
• Neutral Sentiment: Investors are also watching the cancer-screening business and a potential major acquisition, which could expand Tempus AI’s capabilities but may introduce execution and financing risks. Tempus AI Earnings and Cancer Screening Business
• Negative Sentiment: Despite the adjusted profit, Tempus AI remains unprofitable on a GAAP basis, with a negative net margin and negative return on equity. A reported $17.6 million insider stock sale may also temper sentiment, particularly after the recent rally. Tempus AI CEO Stock Sale

Tempus AI Stock Up 8.7%

NASDAQ TEM traded up $6.26 on Monday, reaching $78.48. The company had a trading volume of 16,964,106 shares, compared to its average volume of 6,232,624. The company has a debt-to-equity ratio of 3.06, a current ratio of 3.30 and a quick ratio of 3.16. Tempus AI has a 1 year low of $40.77 and a 1 year high of $90.53. The firm has a 50-day moving average of $70.69 and a 200-day moving average of $57.07. The firm has a market capitalization of $14.16 billion, a PE ratio of -54.50 and a beta of 3.61.

Tempus AI (NASDAQ:TEM - Get Free Report) last posted its quarterly earnings data on Monday, November 2nd. The company reported $0.07 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of ($0.09) by $0.16. The company had revenue of $411.54 million for the quarter, compared to analyst estimates of $409.39 million. Tempus AI had a negative net margin of 17.77% and a negative return on equity of 50.28%. The business's quarterly revenue was up 23.1% on a year-over-year basis. During the same quarter last year, the firm posted ($0.46) earnings per share. On average, equities research analysts anticipate that Tempus AI will post -1.45 EPS for the current fiscal year.

Analysts Set New Price Targets

Several research analysts recently commented on the stock. Raymond James Financial set a $80.00 price target on shares of Tempus AI in a report on Wednesday, September 2nd. Weiss Ratings raised shares of Tempus AI from a "sell (e+)" rating to a "sell (d-)" rating in a research report on Tuesday, October 13th. JPMorgan Chase & Co. raised their target price on shares of Tempus AI from $45.00 to $70.00 and gave the company a "neutral" rating in a research note on Wednesday, October 14th. Piper Sandler upgraded shares of Tempus AI from a "neutral" rating to an "overweight" rating and lifted their target price for the company from $56.00 to $76.00 in a report on Tuesday, September 1st. Finally, Canaccord Genuity Group upped their price target on shares of Tempus AI from $80.00 to $95.00 and gave the stock a "buy" rating in a research report on Monday, October 12th. Eleven investment analysts have rated the stock with a Buy rating, nine have assigned a Hold rating and two have given a Sell rating to the company. According to data from MarketBeat, the company currently has a consensus rating of "Hold" and a consensus target price of $73.21.

Insider Buying and Selling at Tempus AI

In related news, CEO Ryan Fukushima sold 700 shares of the company's stock in a transaction that occurred on Wednesday, September 16th. The shares were sold at an average price of $70.00, for a total transaction of $49,000.00. Following the completion of the transaction, the chief executive officer owned 15,874 shares of the company's stock, valued at approximately $1,111,180. This represents a 4.22% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Eric P. Lefkofsky sold 250,000 shares of the company's stock in a transaction on Tuesday, October 27th. The stock was sold at an average price of $70.36, for a total value of $17,590,000.00. Following the sale, the chief executive officer owned 50,000 shares of the company's stock, valued at approximately $3,518,000. The trade was a 83.33% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders have sold 1,256,777 shares of company stock valued at $86,356,352. 24.26% of the stock is currently owned by insiders.

Hedge Funds Weigh In On Tempus AI

Institutional investors and hedge funds have recently added to or reduced their stakes in the company. Sumitomo Mitsui Trust Group Inc. increased its holdings in Tempus AI by 23.4% during the 1st quarter. Sumitomo Mitsui Trust Group Inc. now owns 4,326,313 shares of the company's stock worth $195,636,000 after purchasing an additional 821,490 shares during the last quarter. Amova Asset Management Americas Inc. boosted its holdings in Tempus AI by 23.4% in the first quarter. Amova Asset Management Americas Inc. now owns 4,326,313 shares of the company's stock worth $195,549,000 after purchasing an additional 821,490 shares during the period. Eagle Health Investments LP bought a new stake in Tempus AI during the first quarter valued at $11,588,000. Swiss National Bank raised its holdings in shares of Tempus AI by 0.3% during the first quarter. Swiss National Bank now owns 183,500 shares of the company's stock worth $8,298,000 after purchasing an additional 600 shares during the period. Finally, Aristotle Atlantic Partners LLC acquired a new stake in shares of Tempus AI during the first quarter worth $6,179,000. 24.22% of the stock is owned by hedge funds and other institutional investors.

Tempus AI Company Profile

Tempus AI, Inc is a healthcare technology company that uses artificial intelligence and data analytics to support precision medicine. The company combines clinical, molecular and imaging data to help physicians make more informed treatment decisions and to help researchers and biopharmaceutical companies develop therapies.

Its offerings include genomic testing and analysis, such as tissue- and blood-based tests, as well as software tools designed to assist with clinical decision-making, patient matching for clinical trials and the management of healthcare data.

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