Why Tandem Diabetes Care is Back on Investors’ Radar

Tandem Diabetes Care (TNDM) has drawn fresh attention after a year of mixed share performance, with a negative 1 year total return alongside a gain over the past 3 months.

At a last close of US$20.09, the stock sits below its recent month level and below its past 1 day move. The business continues to report over US$1.0b in revenue and a loss of US$203.37m.

With the share price at US$20.09, Tandem Diabetes Care has paired a 32.08% 3 month share price return with a 44.81% 1 year total shareholder return decline, suggesting recent momentum after a tougher stretch for longer term holders.

If you are comparing Tandem with other medical names, this could be a good moment to scan healthcare stocks for more ideas that fit your watchlist.

With a value score of 4, an intrinsic value estimate suggesting roughly a 10% discount, and shares trading below some analyst targets, the key question is whether Tandem is genuinely undervalued at this level or whether the market is already pricing in future growth.

Most Popular Narrative: 21.9% Undervalued

Against the last close of $20.09, the most followed narrative puts Tandem Diabetes Care’s fair value at about $25.71, creating a clear valuation gap to unpack.

Broader pharmacy channel expansion and acceleration of pharmacy-based supply sales are expected to lower out-of-pocket costs, increase pump adoption rates, and shift more high-margin recurring supply sales through premium-priced channels, supporting future revenue growth, margin expansion, and improved earnings.

Analysts build this valuation on more than a simple revenue line. Recurring supplies, margin shifts, and a long runway for pump adoption all sit underneath the fair value story. If you want to see how these moving parts fit together, the full narrative lays out the assumptions in detail.

Result: Fair Value of $25.71 (UNDERVALUED)

However, there are still meaningful risks, including tougher insulin pump competition and uncertainty around pharmacy channel margins, which could challenge the current undervaluation story.

Build Your Own Tandem Diabetes Care Narrative

If you look at the numbers and reach a different conclusion, or just prefer to test your own view, you can create a custom narrative in a few minutes using Do it your way.

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Tandem Diabetes Care.

Looking for more investment ideas?

If Tandem has sparked your interest, do not stop here. Broaden your watchlist with focused stock ideas that match different goals and risk levels.

• Spot early stage opportunities by scanning these 3537 penny stocks with strong financials that combine smaller market caps with more established financials than you might expect.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.