Jefferies upgraded Tempus AI from Underperform to Hold and raised its price target to $70 from $35. The stock was trading at $78.48 in the report, above the revised target, after gaining 43% over the previous six months.

The firm pointed to accelerating growth in Tempus AI’s Data and Applications segments and several major strategic collaborations this year. It also cited revenue growth of 50% as evidence of the company’s momentum. Jefferies said plans to pursue FDA approval for xR could help address reimbursement challenges, while the expected average selling price benefit from xT in 2027 and anticipated FDA approval for xF also informed its outlook.

Jefferies had previously raised concerns about the durability of demand for Insights, reliance on opt-ins, reimbursement for xR and the rationale behind the PSNL deal. The firm now views these areas more positively, but said execution on the deal remains important. Its questions include the near-term outlook for unit economics, the potential effect on margins in 2027 and Tempus AI’s ability to generate meaningful growth through acquisitions. Slowing growth at Ambry is another consideration.

Jefferies said Tempus AI trades at eight times enterprise value to 2027 sales, making significant multiple expansion less likely without stronger evidence of execution. The report also noted that the stock may be overvalued relative to InvestingPro’s fair-value estimate.

In separate recent results cited in the report, Tempus AI posted third-quarter 2026 adjusted earnings of $0.07 per share, compared with a $0.01 forecast, and revenue of $411.5 million, up 23% year over year. Adjusted EBITDA was $25.6 million, the company’s first positive result on that measure, and it raised its full-year revenue outlook to $1.60 billion-$1.605 billion.

Needham subsequently raised its price target to $89 from $75 and maintained a Buy rating, citing growth in the data business. Tempus AI’s diagnostics revenue rose 20% to $303.5 million, while Data and Applications revenue increased 33% to $108.1 million. The company also highlighted strategic collaborations, including a long-term agreement with Bristol Myers Squibb.

Sources: Investing.com News.