Tarsus Pharmaceuticals, Inc. (TARS)
NASDAQ:TARS
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Tarsus Pharmaceuticals
(NASDAQ:TARS)
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Rating:62Neutral
Price Target:
$68.00
▲(1.13% Upside)
Action:ReiteratedDate:02/25/26
The score is driven primarily by improving financial fundamentals (rapid revenue growth, very high gross margins, and a de-risked balance sheet) and a constructive earnings call with strong 2026 growth guidance. Offsetting these positives are continued losses and cash burn (weak cash flow profile) and limited valuation support due to a negative P/E, while technical signals are positive but not fully confirmed.
Positive Factors
High product-level gross margins
Sustained ~93% gross margins after manufacturing and direct costs indicate extremely strong unit economics. This durable margin structure provides room to absorb distribution/reimbursement pressures and funds margin conversion as SG&A leverage improves, accelerating the path from product profitability to company-level profits.
Negative Factors
Negative operating and free cash flow
Persistent negative operating and free cash flow, despite improvement, mean the business still consumes cash to grow. Ongoing cash burn makes funding contingent on continued sales acceleration, disciplined spend, or external financing; failure to convert product-line profitability into company-level cash generation increases execution and liquidity risk.
Read all positive and negative factors
Positive Factors
Negative Factors
High product-level gross margins
Sustained ~93% gross margins after manufacturing and direct costs indicate extremely strong unit economics. This durable margin structure provides room to absorb distribution/reimbursement pressures and funds margin conversion as SG&A leverage improves, accelerating the path from product profitability to company-level profits.
Read all positive factors
Tarsus Pharmaceuticals (TARS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.75B
Dividend YieldN/A
Average Volume (3M)463.89K
Price to Earnings (P/E)―
Beta (1Y)0.20
Revenue Growth146.71%
EPS Growth48.11%
CountryUS
Employees323
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)-1.62
Shares Outstanding42,557,490
10 Day Avg. Volume433,533
30 Day Avg. Volume463,891
Financial Highlights & Ratios
PEG Ratio1.07
Price to Book (P/B)9.96
Price to Sales (P/S)7.58
P/FCF Ratio-153.35
Enterprise Value/Market Cap0.97
Enterprise Value/Revenue5.93
Enterprise Value/Gross Profit6.62
Enterprise Value/Ebitda-47.93
Forecast
1Y Price Target
$88.78Price Target Upside32.03% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering9
EPS Forecast (FY)-0.7
Revenue Forecast (FY)$693.49M
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 ...
How the Company Makes Money
Tarsus primarily makes money by selling its FDA-approved prescription product, XDEMVY, in the United States. Revenue is generated from product sales into the pharmaceutical distribution channel (e.g., sales to wholesalers/specialty distributors) a...
Tarsus Pharmaceuticals Earnings Call Summary
Earnings Call Date:Feb 23, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Aug 06, 2026
Earnings Call Sentiment Positive
The call communicated a strongly positive commercial trajectory for XDEMVY—robust 2025 performance, bold 2026 guidance (+~50% at midpoint), expanding awareness and payer coverage, product-line profitability, and a funded pipeline with near-term clinical catalysts for TP-04 and TP-05. Offsetting these positives are material near-term expense levels, a high gross-to-net discount (~43%-45%), Q1 seasonality headwinds and reliance on new-patient driven growth until refill rates stabilize. Overall, the company presents clear growth momentum but must demonstrate operating leverage and sustained margin conversion to fully realize its $2B+ peak sales ambition.Positive Updates
Strong 2025 Revenue Performance
Full-year 2025 net product sales of $451.4 million and Q4 2025 net product sales of $151.7 million, demonstrating rapid commercial traction since launch.
Negative Updates
High Operating Expenses and Near-Term Profitability Pressure
Total operating expenses for 2025 were $522.3 million—exceeding 2025 net sales of $451.4M—indicating company-level profitability remains a work in progress and requiring continued operating leverage as revenue scales.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong 2025 Revenue Performance
Full-year 2025 net product sales of $451.4 million and Q4 2025 net product sales of $151.7 million, demonstrating rapid commercial traction since launch.
Read all positive updates
Company Guidance
Management provided full‑year 2026 guidance calling for net product sales of $670–700 million (implying >$230 million of incremental sales and roughly 50% growth at the midpoint versus FY2025 sales of $451.4 million; Q4 2025 was $151.7 million), while noting revenue won’t be linear (Q1 expected flat to slightly below Q4’25 due to deductible resets and higher gross‑to‑net, then strong Q2, more tempered Q3 and robust Q4). They expect long‑run gross‑to‑net of about 43–45% (Q4’25 was ~44%), gross margin ~93%, SG&A $545–565 million (including ~$40 million stock‑based comp, ~$80 million of DTC/XDEMVY marketing and ~15–20 new key account leaders), R&D $115–135 million (including ~$20 million SBC) with the TP‑04 Phase II budget $7–10 million and TP‑05 Phase II ~$25–30 million, year‑end cash of ~ $418 million, product‑line profitability for XDEMVY today, a steady‑state refill rate target of ~20% (current weekly refills low–mid teens), and an expectation of increasing operating leverage toward company‑level profitability.Tarsus Pharmaceuticals Financial Statement Overview
Summary
Income Statement
56
Neutral
Balance Sheet
74
Positive
Cash Flow
42
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 451.36M | 182.95M | 17.45M | 25.82M | 57.03M |
| Gross Profit | 420.68M | 170.13M | 15.85M | 24.86M | 54.95M |
| EBITDA | -53.61M | -106.48M | -131.67M | -59.70M | -13.46M |
| Net Income | -66.42M | -115.55M | -135.89M | -62.09M | -13.83M |
Balance Sheet | |||||
| Total Assets | 562.16M | 376.99M | 265.49M | 227.86M | 178.91M |
| Cash, Cash Equivalents and Short-Term Investments | 417.27M | 291.38M | 227.44M | 217.03M | 171.81M |
| Total Debt | 93.64M | 72.45M | 30.22M | 20.21M | 1.89M |
| Total Liabilities | 218.73M | 152.46M | 68.50M | 34.96M | 12.18M |
| Stockholders Equity | 343.43M | 224.53M | 196.99M | 192.90M | 166.73M |
Cash Flow | |||||
| Free Cash Flow | -22.31M | -84.59M | -123.00M | -49.54M | 3.16M |
| Operating Cash Flow | -12.45M | -83.03M | -117.49M | -49.03M | 3.75M |
| Investing Cash Flow | -42.12M | -199.19M | 140.60M | -144.63M | -586.00K |
| Financing Cash Flow | 143.39M | 154.66M | 130.18M | 93.99M | 21.00K |
Tarsus Pharmaceuticals Technical Analysis
Negative
67.24
Price Trends
69.17
Negative
72.94
Negative
65.01
Positive
Market Momentum
0.25
Positive
42.69
Neutral
31.58
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TARS, the sentiment is Negative. The current price of 67.24 is below the 20-day moving average (MA) of 68.93, below the 50-day MA of 69.17, and above the 200-day MA of 65.01, indicating a neutral trend. The MACD of 0.25 indicates Positive momentum. The RSI at 42.69 is Neutral, neither overbought nor oversold. The STOCH value of 31.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TARS.
Tarsus Pharmaceuticals Risk Analysis
Tarsus Pharmaceuticals disclosed 80 risk factors in its most recent earnings report. Tarsus Pharmaceuticals reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Tarsus Pharmaceuticals Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $2.94B | 53.53 | -10.26% | ― | 91.34% | 88.80% | |
62 Neutral | $2.75B | -104.60 | -19.63% | ― | 146.71% | 48.11% | |
58 Neutral | $3.09B | 2.92 | -7.31% | ― | 120.01% | 78.83% | |
52 Neutral | $1.86B | -4.98 | -63.98% | ― | 26.92% | 10.74% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
51 Neutral | $2.96B | -5.63 | -50.13% | ― | ― | -15.30% | |
43 Neutral | $2.58B | -11.58 | -32.80% | ― | ― | -50.17% |
* Healthcare Sector Average
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Tarsus Pharmaceuticals Corporate Events
Business Operations and StrategyExecutive/Board Changes
Tarsus Pharmaceuticals Adds Industry Veteran to Board
Positive
Feb 18, 2026
On February 18, 2026, Tarsus Pharmaceuticals expanded its board from seven to eight members and appointed veteran biopharmaceutical executive David E. I. Pyott, former chairman and CEO of Allergan, as a Class III director, effective immediately. P...
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.