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We came across a bullish thesis on Tempus AI, Inc. (TEM) on Substack by Oliver | MMMT Wealth. In this article, we will summarize the bulls’ thesis on TEM. Tempus AI, Inc. (TEM)'s share was trading at $43.23 as of April 22nd.
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Tempus AI (TEM) is emerging as one of the highest-quality plays in health technology, delivering strong 2-year revenue and EBITDA growth projections of over 20%. Currently trading at just 6.0x next twelve months (NTM) sales despite a robust 35% revenue growth outlook, the stock appears undervalued, especially considering its historical tendency to rebound sharply whenever it dips below 7x sales. Tempus stands out as a diversified company in the health tech sector, operating across a broad spectrum including genomics, data licensing, and artificial intelligence applications. This multi-pronged business model not only supports stable and recurring revenue streams but also positions the company to benefit from long-term trends in healthcare digitization and personalized medicine. The valuation discount seems unjustified given the company’s scale, momentum, and technology leadership. For investors, this dislocation creates an attractive entry point into a high-growth company.
Tempus AI, Inc. (TEM) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 17 hedge fund portfolios held TEM at the end of the fourth quarter which was 7 in the previous quarter. While we acknowledge the risk and potential of TEM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than TEM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article was originally published at Insider Monkey.