William Blair downgraded Tempus AI Inc (NASDAQ:TEM) to “Market Perform” from “Outperform,” citing the stock’s 111% year-to-date rally rather than concerns about the company’s fundamentals.
The stock’s surge was driven partly by market momentum, including Nancy Pelosi’s Tempus call option purchase and AI investment under the Trump administration’s Stargate initiative, though neither is expected to significantly impact Tempus’ financials.
Valuation analysis, using comparable company metrics and cash flow models, suggests a fair value of around $65 per share, close to the current $71.21 price. The firm does not anticipate much upside beyond the company’s post-Ambry Genetics acquisition guidance of 75% revenue growth in 2025 and adjusted EBITDA profitability.
While Tempus has solid fundamentals, William Blair believes its current valuation justifies a more neutral stance.