We recently published a list of Top 10 Stocks Everyone Is Talking About These Days. In this article, we are going to take a look at where Tempus AI, Inc. (NASDAQ:TEM) stands against other top stocks everyone is talking about these days.
Major AI stocks are wavering as investors assess the impact of decreasing hardware costs and their effects on technology spending. T. Rowe Price’s Tony Wang said in a latest program on CNBC that while Mag. 7 companies are still strong, there are opportunities to look elsewhere as the technology-related gains broaden out.
“You saw the Mag. 7 really dominate the last two years, and I think going into this year, I think that there’s a lot of concern over the capex that’s being spent. I mean, they’re kind of becoming fundamentally different businesses in some respect in terms of the capital intensity. And then on top of that, you had kind of more inline reports, and so when you’re spending a lot of capex and you’re coming in line, I think that tends to set up for a tougher stock reaction. And so, you know, I think there’s other areas in tech that naturally things will broaden out to, like things that have more bottoming fundamentals and can have a little bit easier setup. So I think that, you know, we’re looking for more broadening, and I think that these are still very good companies and still like a core part of tech portfolios, but I think there’s opportunity elsewhere as well.”
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For this article, we picked 10 stocks currently trending on latest news and analyst ratings. With each stock we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
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Tempus AI, Inc. (NASDAQ:TEM)
Number of Hedge Funds Investors: 7
Cathie Wood and Ark Invest recently bought 400,000 shares of Tempus AI, Inc. (NASDAQ:TEM). The stock is up 80% so far this year. The Ark Innovation ETF (NYSEARCA:ARKK) bought 367,388 shares, while the ARK Genomic Revolution ETF (BATS:ARKG) added 78,570 shares.
Baron Discovery Fund stated the following regarding Tempus AI, Inc (NASDAQ:TEM) in its Q3 2024 investor letter:
“Shares of Tempus AI, Inc (NASDAQ:TEM) contributed to performance. Tempus is a cancer diagnostics company that provides genomic testing results. Tempus has also amassed an over 200 petabyte proprietary multimodal dataset that combines clinical patient data with genomic testing data. In addition to using this data to empower more intelligent diagnostics for its own tests, Tempus also licenses this data to biopharmaceutical companies which use it to design smarter clinical trials and identify potential new drug targets. We think this proprietary dataset is unique with meaningful barriers to entry, and brings meaningful value to biopharmaceutical R&D. As we mentioned in the letter from last quarter, shares have been incredibly volatile. We took advantage of this volatility to buy a meaningful position when shares sold off into the low $20’s per share from an IPO price of $37. When shares spiked into the mid-$70’s (likely due to short sellers covering losses as shares rose), we took profits on a meaningful portion of the investment as we believed valuation had become stretched (shares now trade in the high $40’s to low $50’s level). We like our position sizing now, and would add to the position at lower valuations. We believe that Tempus has significant growth ahead of it and we are excited about its unique business model.”
Overall, TEM ranks 10th on our list of top stocks everyone is talking about these days. While we acknowledge the potential of TEM as an investment, our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than TEM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
