Tarsus Pharmaceuticals (TARS) AI Stock Analysis

• Market Cap: $3.10B
• Dividend Yield: N/A
• Average Volume (3M): 539.22K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.50
• Revenue Growth: 182.44%
• EPS Growth: 47.21%
• Country: US
• Employees: 323
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): -0.30
• Shares Outstanding: 42,449,104
• 10 Day Avg. Volume: 497,400
• 30 Day Avg. Volume: 539,221
• PEG Ratio: 0.54
• Price to Book (P/B): 9.27
• Price to Sales (P/S): 11.38
• P/FCF Ratio: -24.61
• Enterprise Value/Market Cap: 0.71
• Enterprise Value/Revenue: 6.04
• Enterprise Value/Gross Profit: 6.81
• Enterprise Value/Ebitda: -30.49
• 1Y Price Target: $74.33
• Price Target Upside: -3.43% Downside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): -1.57
• Revenue Forecast (FY): $429.52M

• Rating: 60 Neutral
• Price Target: $79.00 ▲(2.64% Upside)

Tarsus Pharmaceuticals' overall stock score reflects a strong technical performance and positive earnings call sentiment, offset by financial challenges. The company's robust revenue growth and successful product launch are significant strengths, but profitability and cash flow issues weigh on the score. The technical indicators suggest bullish momentum, although caution is advised due to overbought signals. Valuation remains a concern with negative earnings impacting the P/E ratio.

Positive Factors

Revenue Growth

Strong revenue growth indicates effective product adoption and market penetration, supporting long-term business expansion and sustainability.

Product Launch Success

Successful launch of XDEMVY demonstrates strong market demand and execution capability, enhancing the company's competitive position in ophthalmology.

Pipeline Expansion

Expanding pipeline into new therapeutic areas diversifies revenue streams and strengthens long-term growth prospects by addressing additional unmet medical needs.

Negative Factors

Profitability Challenges

Ongoing profitability challenges due to high operational costs can hinder long-term financial health and limit reinvestment opportunities.

Cash Flow Issues

Persistent cash flow issues may restrict the company's ability to fund operations and growth initiatives, posing a risk to financial stability.

Rising Operational Costs

Increasing operational expenses could pressure margins and profitability, potentially affecting the company's ability to sustain growth and invest in new opportunities.

Tarsus Pharmaceuticals Business Overview & Revenue Model

Company Description

Tarsus Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, focuses on the development and commercialization of novel therapeutic candidates for ophthalmic conditions. Its lead product candidate is TP-03, a novel therapeutic that is in Phase III for the treatment of blepharitis caused by the infestation of Demodex mites, as well as to treat meibomian gland disease. The company is also developing TP-04 for the treatment of rosacea; and TP-05 for Lyme prophylaxis and community malaria reduction. In addition, the company develops lotilaner to address diseases across therapeutic categories in human medicine, including eye care, dermatology, and other diseases. Tarsus Pharmaceuticals, Inc. was incorporated in 2016 and is headquartered in Irvine, California.

How the Company Makes Money

Tarsus Pharmaceuticals generates revenue primarily through the development and commercialization of its pharmaceutical products. The company's revenue model is centered around bringing its lead product, TP-03, to market, which includes potential sales from prescriptions once it receives regulatory approval. Furthermore, Tarsus may engage in strategic partnerships with larger pharmaceutical companies for co-development and commercialization agreements, which can provide upfront payments, milestone payments, and royalties on future sales. The company may also generate revenue through grants or funding from research initiatives. As it advances its clinical programs and potentially secures regulatory approvals, Tarsus aims to establish a stream of income through direct product sales and collaborations.

Tarsus Pharmaceuticals Financial Statement Overview

Summary

Tarsus Pharmaceuticals is experiencing robust revenue growth, but profitability remains a significant challenge with negative margins. The balance sheet is relatively stable with moderate leverage, but returns on equity are negative. Cash flow issues persist, with negative operating and free cash flows, highlighting the need for improved cash management and operational efficiency.

Income Statement

Tarsus Pharmaceuticals has shown a strong revenue growth rate of 23.88% TTM, indicating positive momentum in sales. However, the company is facing significant profitability challenges with a negative net profit margin of -22.17% and negative EBIT and EBITDA margins, reflecting ongoing operational inefficiencies and high costs relative to revenue.

Balance Sheet

The balance sheet shows a moderate debt-to-equity ratio, indicating a balanced approach to leveraging. However, the return on equity is negative, suggesting that the company is not generating sufficient returns on shareholders' equity. The equity ratio is stable, showing a solid capital structure.

Cash Flow

The cash flow statement reveals negative operating and free cash flows, with a declining free cash flow growth rate of -28.79% TTM. The operating cash flow to net income ratio is negative, indicating cash flow challenges. However, the free cash flow to net income ratio is above 1, suggesting some efficiency in converting income to cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	366.10M	182.95M	17.45M	25.82M	57.03M	0.00
Gross Profit	325.13M	170.13M	15.85M	24.86M	54.95M	-246.00K
EBITDA	-72.59M	-106.48M	-131.67M	-59.70M	-13.46M	-26.56M
Net Income	-81.16M	-115.55M	-135.89M	-62.09M	-13.83M	-26.81M
Balance Sheet
Total Assets	534.56M	376.99M	265.49M	227.86M	178.91M	171.97M
Cash, Cash Equivalents and Short-Term Investments	401.84M	291.38M	227.44M	217.03M	171.81M	168.13M
Total Debt	82.51M	72.45M	30.22M	20.21M	1.89M	831.00K
Total Liabilities	199.48M	152.46M	68.50M	34.96M	12.18M	5.99M
Stockholders Equity	335.08M	224.53M	196.99M	192.90M	166.73M	165.98M
Cash Flow
Free Cash Flow	-62.54M	-84.59M	-123.00M	-49.54M	3.16M	-21.59M
Operating Cash Flow	-53.96M	-83.03M	-117.49M	-49.03M	3.75M	-21.14M
Investing Cash Flow	-150.96M	-199.19M	140.60M	-144.63M	-586.00K	-456.00K
Financing Cash Flow	144.00M	154.66M	130.18M	93.99M	21.00K	131.77M

Tarsus Pharmaceuticals Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 76.97
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TARS, the sentiment is Positive. The current price of 76.97 is above the 20-day moving average (MA) of 70.49, above the 50-day MA of 65.09, and above the 200-day MA of 51.40, indicating a bullish trend. The MACD of 2.46 indicates Negative momentum. The RSI at 67.03 is Neutral, neither overbought nor oversold. The STOCH value of 77.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TARS.

Tarsus Pharmaceuticals Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TARS	60 Neutral	$3.10B	―	-28.35%	―	182.44%	47.21%
ARQT	59 Neutral	$3.06B	―	-28.17%	―	129.21%	80.35%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
DNLI	45 Neutral	$2.18B	-5.31	-44.44%	―	―	-5.30%
IRON	43 Neutral	$3.38B	―	-34.78%	―	―	-34.96%
RXRX	40 Neutral	$2.16B	―	-91.06%	―	-32.98%	-18.46%
BEAM	40 Neutral	$2.23B	-4.94	-47.19%	―	-84.07%	-157.71%

Tarsus Pharmaceuticals Corporate Events

Tarsus Pharmaceuticals’ Earnings Call Highlights Growth and Challenges

Tarsus Pharmaceuticals’ recent earnings call painted a picture of optimism, underscored by exceptional product launches, strong financial results, and promising pipeline developments. Despite these positive signals, the company acknowledged ongoing challenges with Medicare-related discounts and rising operational costs.

Tarsus Pharmaceuticals Reports Strong Q3 2025 Growth

Tarsus Pharmaceuticals, Inc. is a company that leverages scientific advancements and technology to innovate treatments primarily in the eye care sector, with a focus on addressing unmet medical needs. The company is known for its FDA-approved product, XDEMVY, which treats Demodex blepharitis, and is actively developing treatments for ocular rosacea and Lyme disease prevention.