Tempus AI Has Grown Revenue 54.6% a Year, but Losses and 27.5 Times Book Value Put the Model at Sell

Tempus AI, which combines genetic testing with clinical and molecular data to support cancer care and drug development, has grown revenue at a 54.6% compound annual rate over five years, reaching $1.4 billion over the trailing twelve months. It is still losing money, though, and its shares trade at 27.50 times book value. This Tempus AI stock analysis, based on Yahoo Finance data as of October 13, 2026, explains why the scoring model rates the stock a Sell by a narrow margin, and where the business is stronger than its headline losses suggest.

What Is Happening With the Stock Price

Tempus AI trades at $67.96, for a market value of $12.26 billion. Its two-year range runs from $35.12 to $96.39, which places the shares in the middle of that range: about 29% below the high and about 94% above the low. That middle position suggests sentiment has cooled from its peak without collapsing, as investors weigh fast revenue growth against the time it is taking to reach profitability.

Quality: Is This a Financially Sound Business?

Quality scores 28/100. The gross margin of 64.0% shows that the testing and data business carries solid unit economics, but operating costs push the operating margin to -19.6% and the net margin to -17.8%, for earnings per share of -$1.44. Return on assets is -8.8%. Return on equity of -67.4% is magnified by a small equity base, which also explains a debt-to-equity ratio of 3.25: the company’s debt is large relative to the equity on its balance sheet.

Cash flow is better than the accounting losses in this Tempus AI stock analysis. A -17.8% net margin on $1.4 billion of revenue implies a loss of roughly $250 million, but free cash flow was only -$99 million, about -7% of revenue. Non-cash charges such as stock-based compensation and the amortization of acquired assets likely account for much of the difference. Liquidity is also solid, with a current ratio of 3.30 and a quick ratio of 3.01, which gives the company room to keep investing while it works toward breaking even.

Growth: Does This Company Have Real Upside?

Growth scores 67/100, the strongest pillar. Trailing revenue growth of 21.6% is well below the 54.6% five-year compound rate, so growth is slowing as the company gets bigger, and part of the earlier growth came from acquisitions, including the genetic testing company Ambry Genetics. Earnings growth is N/A because the company is loss-making. The EV/Revenue multiple of 9.38 is high for a diagnostics company and assumes growth stays strong and margins keep improving. A 64.0% gross margin gives Tempus AI room to become profitable if revenue keeps outgrowing operating costs.

Opportunity: Is Now a Good Time to Enter?

Opportunity scores 7/100, the weakest pillar. There is no P/E because earnings are negative, and EV/EBITDA of -66.33 is not meaningful. The price-to-book ratio of 27.50 is very high, and the free cash flow yield is -0.8%. A share price in the middle of its two-year range offers neither a deep discount nor clear momentum. The main risks are that losses persist longer than expected, that the debt load or new share issuance weighs on shareholders, that insurers and health systems change how they reimburse diagnostic tests, and that rules on the use of patient and genomic data tighten.

Tempus AI Stock Analysis: The Bottom Line

Our Tempus AI stock analysis finds a fast-growing company whose valuation already assumes a lot of future success. Quality is 28/100, Growth 67/100 and Opportunity 7/100, for a recommendation score of 34/100. That is just below the 35 threshold that separates a Sell from a Hold in the model, so the Sell signal is a close call. The bull case is a 54.6% five-year revenue growth rate, a 64.0% gross margin, modest cash burn of $99 million and strong liquidity. The bear case is continuing losses, debt-to-equity of 3.25, slowing growth and a valuation of 27.50 times book value. Narrowing losses or a lower share price could move the signal to Hold. Buy / Hold / Sell reflects StreetBriefs’ quantitative scoring model (Quality, Growth, Opportunity), a data-driven signal for further research, not a personalized recommendation to transact.