Tempus AI Stock (NASDAQ: TEM) Down 20% From Highs Leading Into Earnings

Tempus AI's stock (NASDAQ: TEM) has been a significant outperformer on the index this year, despite a recent 20% pullback from highs. When accounting for the past few days' correction, the stock price remains an impressive 108% up YTD.

This significant rally was influenced by positive market sentiment and pivotal announcements regarding Tempus' advancements in artificial intelligence driven healthcare technology, primarily motivated by the introduction of a new AI-enabled health application, Olivia.

The application is designed to serve as a personal health concierge service, aiming to centralise health records while providing AI-generated insights. Olivia features a Smart Profile Summary and an AI-enabled Notetaker, enhancing patient engagement and experience.

Eric Lefkofsky, founder and CEO of Tempus, highlighted the potential of Olivia in empowering patients for better health management. The announcement of the app notably contributed to the upward movement in Tempus' stock price, reinforcing its role as a leader in healthcare innovation.

Market analysts have continued to support the stock, but the pace of appreciation has caught most behind, with the consensus target of $58.60 now clearly down on the current price action ~$71.50.

With earnings looming on Monday 24th Feb, Tempus has the opportunity to offer up some concrete numbers. The previous quarter's revenue came in at $180.93 million, a beat on the $179.56 expected. Nonetheless, the company recorded a net loss with an EPS of -$0.25, itself an outperformance on the -$0.28 expected.

Looking forward to Monday's earnings, and markets are expecting Tempus to come in with an EPS of -$0.15, against revenue of $202.80. After such a rally, anything less than a firm beat and raise may be harshly treated.