Cathie Wood, CEO of ARK Investment, said that “the highest application of AI” is health care.
“We have 37 trillion cells in our body and when we are looking for a treatment, they will be sequenced.” Wood said on CNBC in February.
Healthcare “is currently responsible for incredible storage. The data is the name of the game,” she said.
One of the healthcare companies she has been actively buying in relation to AI is Tempus AI ((tem) .
Her Ark funds purchased 774,000 shares in November, followed by 1.9 million shares in December, 618,000 shares in January, and 527,000 shares in February.
Related: Cathie Wood sells $6 million in 2024’s top stock
As of March 3, Tempus AI ranked the ninth largest stake in ARK Innovation ETF ((Ak) accounting for 4.36% of the portfolio.
Nancy Pelosi, a former House spokesman, also bet on the stock.
In January, Pelosi purchased 50 call options (bets will rise) for $50,000 to $100,000. Within two days of disclosure, the stock gathered more than 40% in two days.
Michael Kovac & Sol; Getty Images
What does tempus ai do?
Tempus AI is a health technology company founded in 2015. It embeds AI into the diagnosis to empower doctors and researchers to make personalized data-driven decisions.
“It wasn’t until recently possible to deploy AI’s capabilities in Precision medicine on a large scale,” the company said in its SEC application.
“Advances in cloud computing, imaging technology, large language models and low-cost molecular profiles, and the digitization of large amounts of healthcare data have created a landscape where we believe AI will eventually mature.”
Tempus AI was listed on June 14, 2024, with its initial public offering price of US$37 per share.
On February 24, the company reported its fourth-quarter and full-year financials.
The company has not made any money yet. It reported a net loss of $706 million in 2024, a net loss of $214 million in 2023 and a net loss of $290 million in 2022.
For the fourth quarter, tempus AI reported adjusted losses of 18 cents per share, with analysts missing expectations for a 15% loss. Fourth-quarter revenue was $200 million, up 36% year-on-year, below consensus analyst estimates.
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The company’s guidance has progressed better. It estimates revenue for fiscal 2025 to be $1.24 billion, up from the analyst consensus of $1.23 billion.
“Our investment in AI has positioned us well in the future, because technology that seemed unimaginable a few years ago allowed us to make our diagnostic smart and help patients live longer and healthier,” said Eric Lefkofsky, founder and CEO of Tempus AI.
He added: “We are still expected to achieve our key financial milestones, with revenue growth and positively adjusted EBITDA in 2025.”
The stock fell more than 17% within five days of its fourth-quarter earnings and revenue report. Even after a stumble, the stock is still 63% higher.
Analysts Raise Tempus AI’s Stock Target
Several analysts have raised their price targets for Tempus AI after the report.
Loop Capital raised its price target for Tempus AI from $52 to $74 and maintained a buy rating. If they are correct, it will represent a 48% increase in tempus AI’s share price.
The investment company said Tempus is the role of sweeping precision TCM trends through healthcare, analysts told investors in a research note.
“Tempus AI should remain a long-term beneficiary of next-generation sequencing as it quickly becomes the standard of care, which is at the tipping point,” Loop said.
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TheFly.com reported on March 3 that Bank of America raised its price target for Tempus AI from $54 to $60, reiterating that the company’s fourth-quarter results matched expectations in mid-January.
JPMorgan lowered Tempus AI from overweight to neutral and raised its target from $50 to $55.
The company said Tempus AI’s 2025 guideline demonstrates “sustainable” data and service revenue, “encourage” average sales price traction, and improves profitability.
Although JP Morgan continues to believe in the “unique combination” of Tempus AI’s diagnostics and data, stocks have relative value on a relative basis after recent stock runs.
“Recent AI headlines and Nancy Pelosi’s call-option purchases have prompted increased retail interest rates,” the company said.
Last check tempus stock fell 6.9% at $52.30
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