Key Stats for Tempus AI Stock
- Earnings Reaction: -7.3%
- Current Price: $53.71
- Valuation Model Target: $112.30
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What Happened?
Tempus AI (TEM) is actively consolidating its lead in the medical data wars, with shares trading near $53.71 following a breakout fourth-quarter earnings release.
The technology pioneer delivered an exceptional 2025, with core revenue surging over 33% year over year as healthcare providers aggressively adopt its AI-driven diagnostic tools.
The company’s “Insights” data licensing business is having a breakout moment, growing a staggering 69% in the fourth quarter when adjusting for warrant impacts.
Management revealed that they have now amassed a massive total contract value (TCV) backlog exceeding $1.1 billion.
This backlog has been rising faster than recognized revenue for several consecutive quarters, signaling a violent acceleration in demand for healthcare AI training data.
CEO Eric Lefkofsky detailed exactly why the company’s 450 petabyte multimodal data set provides an impenetrable competitive moat against traditional AI players.
Lefkofsky stated verbatim: “If somebody wanted to replicate our data business, they’d have to go reproduce all that real-time data, which is quite hard to do. We just have a unique offering and other people have been unable to replicate it.”
To further widen this lead, the company confirmed it hit all primary benchmarks for its first Oncology foundation model deliverable for AstraZeneca.
See analysts’ growth forecasts and price targets for Tempus AI stock (It’s free!) >>>
Is Tempus AI Undervalued Today?
Aggregated analyst data indicate that the market is focusing on short-term diagnostic cycles while underestimating the compounding financial value of Tempus AI’s proprietary distribution network.
The consensus Street target price of $86.71 represents a significant 61.4% potential total return from current levels.
While the diagnostics segment provides the data engine, the “Insights” business delivers elite software-like margins.
The company reported a healthy 126% net revenue retention rate, meaning its existing pharmaceutical clients are dramatically increasing their spend year over year.
Tempus is also seeing explosive growth in its Minimal Residual Disease (MRD) testing, which surged 56% quarter over quarter.
CFO Jim Rogers explained exactly how the migration to FDA-approved versions of their flagship assays will drive structural increases in average selling prices (ASPs).
Rogers stated verbatim: “We think that there’s about $500 or greater than $500 of upside to ASP based on the current mix driven by the continued migration of xT CDx from the LDT version to the FDA-approved version.”
Read the full Tempus AI Transcript on TIKR to see the 2026 guidance breakdown >>>
Valuation Deep Dive
The TIKR Advanced Valuation Model identifies Tempus AI as a high growth data monopoly that is successfully engineering a highly profitable transition into clinical AI applications.
- Target Price: $112.30
- Current Price: $53.71
- Annualized Return (IRR): 10.3%
The Pharmaceutical Data Monopoly: Tempus is methodically absorbing the research and development workflows of the world’s largest pharmaceutical companies. By providing de-identified, real-world data to help pharma giants design more intelligent clinical trials and accelerate drug discovery, the company is creating a recurring revenue stream that is decoupled from the cyclicality of traditional diagnostics. Management projects that the data licensing business will continue to grow in the 40% range throughout 2026.
Explosive Scale and Efficiency: The company is weaponizing its massive compute power, recently procuring a second cluster of over 500 NVIDIA GB200 GPUs to train additional foundation models across cardiology and neuropsychology. According to the TIKR Historical Breakdown, Tempus has delivered a relentless 83.4% Revenue CAGR over the last year. As the business scales toward its long-term goal of 25% sustained growth and positive adjusted EBITDA, the operating leverage will drive a massive rerating of the stock.
Conclusion: A dominant data moat successfully weaponizing artificial intelligence to redefine clinical care. Tempus AI offers a massive 109.1% projected total return potential. The path to the $112.30 target is paved by record data backlogs, surging MRD volumes, and the successful deployment of proprietary AI foundation models.
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How Much Upside Does Tempus AI Stock Have From Here?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
