Tempus AI, Inc. (TEM): A Bull Case Theory

We came across a bullish thesis on Tempus AI, Inc. on Emil Hartela Investing’s Substack by Emil. In this article, we will summarize the bulls’ thesis on TEM. Tempus AI, Inc.'s share was trading at $77.33 as of September 25th. TEM’s trailing P/E was 36.85 according to Yahoo Finance.

Tempus AI sits at the center of an ambitious effort to build a healthcare operating system powered by multimodal data and AI. The company has expanded aggressively through acquisitions like Ambry Genetics, Deep 6, and Paige, which added genomics, trial-matching capabilities, and millions of digitized pathology slides. A joint venture with SoftBank in Japan extends its reach internationally, reinforcing its model of aggregating and labeling complex healthcare data at scale.

Parallel to this expansion, a second wave is emerging around the concept of the “virtual cell”—in-silico models that simulate cellular responses to genetic or drug perturbations. Tempus already supplies data to Recursion, which paid up to $160 million for preferred oncology datasets, signaling real utility in drug discovery. The convergence of deeper datasets with virtual cell tools could reshape target discovery, toxicity prediction, and trial design, with Tempus positioned as a backbone provider.

Leadership is both an asset and a risk. Founder-CEO Eric Lefkofsky brings a track record of speed and scale, but his Groupon history and tight control invite scrutiny. The operating team balances startup builders with scientific, regulatory, and enterprise veterans, while the board features figures like Nobel laureate Jennifer Doudna and former FDA Commissioner Scott Gottlieb.

At ~14 billion dollars, Tempus trades less on cash flow than on option value: if its data flywheel compounds and adoption accelerates, upside is massive. Risks include cultural instability, dilution from M&A, and heavy dependence on founder execution. Still, Tempus’ asymmetric potential makes it a compelling long-horizon bet on AI in healthcare.

Previously we covered a bullish thesis on Tempus AI, Inc. (TEM) by Oliver | MMMT Wealth in April 2025, which highlighted strong revenue and EBITDA growth, undervaluation versus NTM sales, and diversified health tech operations. The company's stock price has appreciated approximately by 79% since our coverage. This is because growth and momentum played out. The thesis still stands as long-term trends persist. Emil Hartela shares a similar view but emphasizes acquisitions, international expansion, and the “virtual cell” opportunity.

Tempus AI, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 27 hedge fund portfolios held TEM at the end of the second quarter which was 21 in the previous quarter. While we acknowledge the potential of TEM as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy NOW 

Disclosure: None.