Verdict: Justified

Since last dive

Key finding: A profit beat on in-line revenue. Q3 revenue was $411.5M (+23%), about in line with the ~$409.4M consensus. Adjusted EBITDA jumped to $25.6M from $1.5M, and adjusted EPS was $0.07 vs a consensus loss. Data & Applications grew +33% with >$550M of data licensing bookings year to date (including a new BMS deal), and new xT pricing adds ~$80M of oncology revenue from 1/1/2027. The full-year revenue guide was nudged up only at the low end ($1.60-1.605B). The stock is +13.0% intraday on above-average volume.

Scorecard

Ticker Rev last Q ($M) Rev YoY last Q Rev YoY prior Q Gross margin (last Q, trend) Op margin EPS last Q vs yr ago P/S Mkt cap 1-mo price %
TEM 411.5 +23.1% +21.6% 64.8% (from 64.5%) -13.8% -0.08 vs -0.46 9.6 $14.4B -11.8%
NTRA 752.8 +37.7% +38.8% 64.5% (from 64.8%) -10.1% -0.47 vs -0.74 20.7 $56.1B +0.2%
GH 335.0 +44.3% +48.3% 65.4% (from 65.2%) -38.6% -0.90 vs -0.80 19.5 $23.0B +0.2%
CAI 263.7 +45.4% +78.8% 68.1% (from 65.4%) +10.2% -0.00 vs -1.87 9.4 $9.3B +12.1%

EPS = GAAP. TEM = September quarter (reported 11/2); NTRA, GH and CAI rows are their June quarter. 1-mo = 9/30 to 10/30 close (before TEM's report-day move). TEM P/S uses trailing revenue including Q3 and today's market cap.

TEM is the cheap, slower-growing name of the group: revenue +23% vs +38-45% for NTRA, GH and CAI, but 9.6x sales vs ~20x for NTRA and GH.
- The operating loss is narrowing (-13.8% vs -18.3% a year ago). CAI is the only one with a positive operating margin.
- TEM trades at about CAI's multiple while CAI grows twice as fast.

Move

Catalyst

Q3 2026, released 11/2 before the open (8-K):
- Revenue $411.5M (+23%) vs ~$409.4M consensus (in line).
- Diagnostics $303.5M (+20%): oncology volume +32%, Hereditary revenue +3%. MRD volume ~12,000 tests (+300%).
- Data & Applications $108.1M (+33%); Insights +29%.
- Gross margin 64.8% (vs 62.8%). GAAP operating loss -$56.9M (vs -$61.0M). Net loss -$14.9M (vs -$80.0M), helped by $42.8M of unrealized gains on securities.
- Adjusted EBITDA $25.6M (vs $1.5M). Adjusted EPS $0.07; consensus was a loss (FMP -$0.09; Investing.com cites +$0.01).
- Data bookings >$550M year to date: BMS oncology data and models up to $137.5M over 5 years; Pathos AI Alzheimer's data $55M over 5 years.
- FY26 guide: revenue raised to $1.60-1.605B (~25% growth; the low end was $1.595B); adjusted EBITDA ~$65M (unchanged).
- 2027: new xT pricing from 1/1/2027 adds ~$80M of oncology ASP uplift (more if xF gets FDA approval). MRD gross profit per test may turn positive ~mid-2027. Management targets 25%+ annual growth and reinvests about two-thirds of incremental gross profit.
- Also: two FDA 510(k) clearances (ECG-PH, ECG-MR); the Personalis acquisition cleared regulatory review (Personalis vote 11/30); a Merck/Moderna collaboration on an individualized neoantigen therapy.

Sector

Risks

Judgement

Justified. The move rests on a real profit turn (adjusted EBITDA $25.6M vs $1.5M, a positive adjusted EPS vs an expected loss), +33% data growth with >$550M of bookings, and visible 2027 upside (~$80M xT pricing). Revenue was only in line and the guide barely moved, so this is a profitability and visibility re-rating, not a revenue surprise. Even after the move, TEM trades at about half the sales multiple of NTRA and GH. Watch the related-party data revenue (Pathos) and the stock comp.

Sources