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Caris Life Sciences, Inc. (CAI)
NASDAQ:CAI
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Caris Life Sciences, Inc.
(NASDAQ:CAI)
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Rating:52Neutral
Price Target:
$26.00
▲(12.26% Upside)
The score is held back primarily by weak underlying financial position (notably negative equity and historical losses) and bearish technical trend signals. These are partially offset by a very strong recent earnings call showing sharp revenue growth, major margin improvement, and a swing to positive profitability and free cash flow, while valuation signals are mixed due to a negative P/E and no dividend data.
Positive Factors
Revenue Growth
The significant revenue growth reflects strong demand for Caris' services, indicating robust market position and potential for sustained expansion.
Improved Gross Margins
Improved gross margins suggest enhanced operational efficiency and pricing power, contributing to better profitability and financial health.
Strong Balance Sheet
A strong cash position provides strategic flexibility for investments in technology and product development, supporting long-term growth.
Negative Factors
Negative Equity Position
Negative equity indicates financial instability, which could limit the company's ability to secure financing and invest in growth opportunities.
Cash Flow Challenges
Negative operating cash flow suggests difficulties in covering operational expenses, potentially impacting the company's ability to sustain operations.
Dependency on Revenue True-Ups
Reliance on revenue true-ups for financial performance indicates potential volatility and uncertainty in revenue streams, affecting predictability.
Caris Life Sciences, Inc. (CAI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.53B
Dividend YieldN/A
Average Volume (3M)2.07M
Price to Earnings (P/E)―
Beta (1Y)1.98
Revenue GrowthN/A
EPS GrowthN/A
CountryUS
Employees1,769
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)0.08
Shares Outstanding282,146,900
10 Day Avg. Volume2,106,697
30 Day Avg. Volume2,072,897
Financial Highlights & Ratios
PEG Ratio-0.52
Price to Book (P/B)-2.85
Price to Sales (P/S)17.30
P/FCF Ratio-28.11
Enterprise Value/Market Cap0.95
Enterprise Value/Revenue11.96
Enterprise Value/Gross Profit19.51
Enterprise Value/Ebitda-72.00
Forecast
1Y Price Target
$37.67Price Target Upside62.65% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering7
EPS Forecast (FY)0.27
Revenue Forecast (FY)$994.64M
Caris Life Sciences, Inc. Business Overview & Revenue Model
Company DescriptionCaris Life Sciences, Inc., an artificial intelligence TechBio company, provides molecular profiling services in the United States and internationally. It develops and commercializes solutions to transform healthcare using molecular information, and machine learning algorithms. The company's molecular profiling services portfolio includes MI Profile, a tissue-based molecular profiling solution; and Caris Assure, a blood-based molecular profiling solution for cancer treatment. It also offers pharma research and development services comprising laboratory delivery, strategic data, and research services to biopharmaceutical customers. The company was founded in 2008 and is headquartered in Irving, Texas.
How the Company Makes MoneyCaris Life Sciences generates revenue through a combination of diagnostic testing services and collaboration with healthcare providers and pharmaceutical companies. The primary revenue stream comes from the sale of its genomic and proteomic profiling tests, which are utilized by oncologists to tailor cancer treatments for individual patients. Additionally, the company engages in partnerships with pharmaceutical companies for biomarker discovery and clinical trial support, which further enhances its revenue. Caris also benefits from reimbursement agreements with insurance providers, allowing for the coverage of its testing services. Furthermore, the company may explore avenues such as licensing agreements and collaborations in research and development, contributing to its overall earnings.
Caris Life Sciences, Inc. Earnings Call Summary
Earnings Call Date:Nov 05, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Aug 18, 2026
Earnings Call Sentiment Positive
Caris Life Sciences delivered an outstanding quarter with record-breaking revenue growth, improved gross margins, and positive profitability metrics. The company achieved significant milestones including a strong balance sheet and increased ASP. However, challenges remain in pharma revenue and the dependency on revenue true-ups. The complex process for MRD approval also presents a challenge.Q3-2025 Updates
Positive Updates
Record-Breaking Revenue Growth
Total revenues increased 113% year-over-year to $216.8 million. Molecular profiling services revenues rose by over 121% year-over-year to $207.6 million.
Significant Increase in ASP
ASP increased to $4,089 per profile, representing growth of 87% year-over-year. This was primarily due to the new CMS rate of $8,455.
Improved Gross Margins
Gross margins improved significantly to 68%, up from 43.7% in the previous year.
Positive Adjusted EBITDA and Net Income
Generated positive adjusted EBITDA of $51.2 million and net income of $24.3 million. Achieved positive free cash flow of $55.3 million.
Strong Balance Sheet
Cash on hand grew to $760 million, an increase of 4.7% sequentially, providing strategic flexibility.
Clinical Case Volume Growth
Clinical case volumes grew by 18.2% year-over-year, with Caris Assure producing 66% year-over-year case volume growth.
Negative Updates
Challenges in Pharma Revenue
Pharma R&D services revenue declined sequentially, though it was up 18% year-over-year. Several projects and associated customer spend shifted into Q4.
Dependency on Revenue True-Ups
Revenue true-up of $37.9 million due to increased payment activity from commercial payers highlights dependency on true-ups for revenue.
Complex Process for MRD Approval
The process for obtaining MRD CMS approval is complex and lengthy, with no specific launch dates provided.
Company Guidance
During the Caris Life Sciences Third Quarter 2025 Earnings Call, the company reported a remarkable 113% year-over-year increase in total revenues, reaching $216.8 million. This growth was driven by a 121% rise in molecular profiling services to $207.6 million and an 18.3% increase in pharma R&D services to $9.2 million. Clinical case volumes grew 18.2% year-over-year, with molecular profiling revenue seeing an 87% rise in average selling price (ASP) to $4,089 per profile. The company's gross margins improved significantly to 68%, and they achieved a positive adjusted EBITDA of $51.2 million, net income of $24.3 million, and positive free cash flow of $55.3 million. The call highlighted the strategic flexibility provided by a cash reserve of nearly $760 million, allowing for continued investment in technology platforms and new product development.Caris Life Sciences, Inc. Financial Statement Overview
Summary
Income statement shows strong revenue growth and improving gross margin, but profitability has been weak with large losses historically. The balance sheet is a major concern due to negative stockholders’ equity, and cash flow remains challenged with negative operating cash flow despite some free cash flow improvement.Income Statement
Caris Life Sciences has experienced significant revenue growth, with a notable increase in gross profit margin from 29.17% in 2023 to 43.37% in 2024. However, the company is facing challenges with profitability, as indicated by negative net profit margins and EBIT margins over the past few years. The net profit margin improved slightly from -111.53% in 2023 to -68.38% in 2024, but it remains a concern. The company needs to address its high operating losses to improve its financial health.45
Neutral
Balance Sheet
The balance sheet of Caris Life Sciences shows a negative stockholders' equity, which is a significant red flag. The debt-to-equity ratio is negative, indicating that the company has more liabilities than assets. Although the return on equity has improved slightly, it remains positive due to negative equity, which is not a sustainable situation. The company needs to improve its equity position to stabilize its financial standing.30
Negative
Cash Flow
Caris Life Sciences has shown some improvement in free cash flow growth, with a 9% increase in 2023. However, the operating cash flow remains negative, and the operating cash flow to net income ratio is also negative, indicating cash flow challenges. The free cash flow to net income ratio is slightly above 1, suggesting that the company is generating enough free cash flow to cover its net losses, but the overall cash flow situation needs improvement.40
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 519.15M | 412.26M | 306.13M | 258.49M | 294.01M | 416.54M |
| Gross Profit | 318.25M | 178.78M | 89.31M | 80.02M | 184.16M | 200.51M |
| EBITDA | -86.22M | -182.95M | -260.80M | -245.89M | 254.46M | 248.30M |
| Net Income | -150.05M | -281.89M | -341.42M | -320.83M | 27.73M | 31.01M |
Balance Sheet | ||||||
| Total Assets | 984.57M | 343.73M | 412.90M | 717.42M | 2.61B | 2.90B |
| Cash, Cash Equivalents and Short-Term Investments | 755.49M | 66.15M | 121.59M | 409.62M | 132.54M | 46.46M |
| Total Debt | 426.74M | 424.26M | 217.27M | 270.87M | 1.75B | 2.10B |
| Total Liabilities | 506.21M | 2.84B | 2.56B | 2.42B | 1.91B | 2.21B |
| Stockholders Equity | 478.36M | -2.50B | -2.14B | -1.70B | 702.24M | 693.24M |
Cash Flow | ||||||
| Free Cash Flow | 27.20M | -253.64M | -298.42M | -327.96M | 57.57M | -65.14M |
| Operating Cash Flow | 38.38M | -245.20M | -276.10M | -285.71M | 277.02M | 254.00M |
| Investing Cash Flow | -11.17M | 52.93M | 214.77M | -282.99M | -33.97M | -271.87M |
| Financing Cash Flow | 661.59M | 200.29M | 10.13M | 10.45M | -249.88M | -108.48M |
Caris Life Sciences, Inc. Risk Analysis
Caris Life Sciences, Inc. disclosed 45 risk factors in its most recent earnings report. Caris Life Sciences, Inc. reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Caris Life Sciences, Inc. Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
52 Neutral | $6.53B | -9.55 | ― | ― | ― | ― | |
52 Neutral | $19.24M | -0.30 | -189.72% | ― | ― | 70.57% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
51 Neutral | $11.98M | -0.45 | -67.47% | ― | ― | 9.63% | |
48 Neutral | $11.32M | -0.26 | -81.97% | ― | -46.88% | 34.83% | |
40 Underperform | $850.67K | ― | ― | ― | -8.57% | -52.17% |
* Healthcare Sector Average
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.