Traders Buy Large Volume of Call Options on Tempus AI (NASDAQ:TEM)

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

Wall Street Analysts Forecast Growth

TEM has been the topic of several recent research reports. Wall Street Zen upgraded shares of Tempus AI from a “sell” rating to a “hold” rating in a research report on Saturday, July 25th. The Goldman Sachs Group initiated coverage on shares of Tempus AI in a research report on Monday, September 21st. They issued a “neutral” rating and a $75.00 target price for the company. Roth Capital assumed coverage on shares of Tempus AI in a research note on Tuesday, September 8th. They issued a “neutral” rating and a $67.00 price target on the stock. TD Cowen reaffirmed a “buy” rating on shares of Tempus AI in a report on Wednesday, July 15th. Finally, Weiss Ratings upgraded Tempus AI from a “sell (e+)” rating to a “sell (d-)” rating in a research report on Tuesday, October 13th. Eleven research analysts have rated the stock with a Buy rating, nine have assigned a Hold rating and two have given a Sell rating to the stock. According to MarketBeat.com, the company presently has an average rating of “Hold” and a consensus price target of $73.21.

Tempus AI News Roundup

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 Price Performance

Shares of TEM stock traded up $6.26 during midday trading on Monday, reaching $78.48. 16,964,106 shares of the company were exchanged, compared to its average volume of 6,232,624. Tempus AI has a 12 month low of $40.77 and a 12 month high of $90.53. The company has a market cap of $14.16 billion, a P/E ratio of -54.50 and a beta of 3.61. The company’s 50 day moving average price is $70.69 and its two-hundred day moving average price is $57.07. The company has a debt-to-equity ratio of 3.06, a quick ratio of 3.16 and a current ratio of 3.30.

Tempus AI (NASDAQ:TEM) last posted its quarterly earnings data on Monday, November 2nd. The company reported $0.07 EPS for the quarter, topping analysts’ consensus estimates of ($0.09) by $0.16. The company had revenue of $411.54 million for the quarter, compared to the consensus estimate of $409.39 million. Tempus AI had a negative return on equity of 50.28% and a negative net margin of 17.77%. The company’s quarterly revenue was up 23.1% compared to the same quarter last year. During the same quarter in the previous year, the business earned ($0.46) EPS. On average, sell-side analysts expect that Tempus AI will post -1.45 earnings per share for the current year.

Insider Buying and Selling

In other Tempus AI news, CEO Ryan Fukushima sold 41,095 shares of Tempus AI stock in a transaction that occurred on Tuesday, August 18th. The stock was sold at an average price of $49.61, for a total value of $2,038,722.95. Following the completion of the transaction, the chief executive officer directly owned 562,463 shares in the company, valued at $27,903,789.43. The trade was a 6.81% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available at this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CFO James Rogers sold 26,313 shares of the stock in a transaction that occurred on Wednesday, August 19th. The stock was sold at an average price of $60.00, for a total value of $1,578,780.00. Following the sale, the chief financial officer owned 106,024 shares in the company, valued at $6,361,440. The trade was a 19.88% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In 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.

Institutional Investors Weigh In On Tempus AI

Institutional investors and hedge funds have recently modified their holdings of the stock. Eagle Health Investments LP acquired a new stake in Tempus AI during the first quarter valued at $11,588,000. Aristotle Atlantic Partners LLC acquired a new position in Tempus AI in the 1st quarter worth about $6,179,000. Headlands Technologies LLC acquired a new position in Tempus AI in the 2nd quarter worth about $2,689,000. Odyssean LLC acquired a new position in Tempus AI in the 2nd quarter worth about $897,000. Finally, Canal Insurance CO raised its stake in shares of Tempus AI by 100.0% during the 1st quarter. Canal Insurance CO now owns 40,000 shares of the company’s stock worth $1,809,000 after purchasing an additional 20,000 shares in the last quarter. Institutional investors and hedge funds own 24.22% of the company’s stock.

About Tempus AI

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.