Tempus AI stock continues its strong bull run and is now trading at its highest level since November last year. TEM jumped to $80, up 95% from its lowest level this year, with market capitalization above $14 billion. This rally may continue as bulls target the key resistance level of $100.
Tempus AI stock price technicals points to more gains
The daily chart shows that the TEM stock bottomed at $41.47 in April, May, and August this year. It formed a triple-bottom pattern, a common bullish reversal sign in technical analysis.
The stock has now soared above the important resistance level of $63.25, the triple-bottom’s neckline. After that, the stock formed a bullish flag pattern, which is made up of a vertical line and a descending channel. This pattern normally leads to more gains over time.
The stock has now moved above the crucial resistance level of $72.90, its highest point in August. It also formed a golden cross on September 3, as the 50-day and 200-day moving averages crossed. This pattern is one of the most highly bullish rate in years.
Tempus AI will likely continue rising as bulls target the key resistance level of $100, up by about 25% above the current level. A drop below the key support level of $72.90 will invalidate the bullish outlook.
TEM stock chart | Source: TradingView
Tempus AI business is growing
Tempus AI stock has been in a strong bullish breakout in the past few months, helped by the ongoing demand of software companies. It also delivered relatively strong financial results, which showed that its business did well.
Its revenue rose by 22% in the second quarter, helped by its oncology business, whose revenue jumped by 31%. The company’s Molecular residual disease volume rose to 9,000 from 6,500 in the previous quarter.
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Tempus AI’s management believes that the revenue growth will continue as demand for its solutions rise. It now expects that its full-year revenue will jump to between $1.59 billion and $1.6 billion, representing a 25% annual growth.
As part of these growth plans, the company announced a big buyout. It is in the process of buying Personalis for an enterprise value of $ 1.5 billion. Personalis provides minimal residual disease (MRD) testing. This is a process that uses DNA sequencing and algorithms to look for tiny traces of tumor DNA after a patient has had surgery, chemotherapy, and radiation.
Yahoo Finance data shows that Tempus AI’s revenue will continue rising, potentially to $1.91 billion next year. Excluding Personalis, the figure may hit $2 billion in that year.
The challenge, however, is that some large acquisitions tend to backfire. A good example of this is when Teladoc spent over $18 billion acquiring Livongo Health. A few years later, it issued a big non-goodwill charge.
Analysts have maintained a fairly bullish outlook. Cathie Wood has maintained a buy rating, and made it one of the biggest companies in her portfolio. HC Wainwright boosted the target from $56 to $66, while UBS, Rothschild, and Roth Capital have a neutral outlook and a target of over $67.
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