Mizuho raised its price objective for Tandem Diabetes Care (TNDM) to $22 from $21 while keeping a Neutral rating. The stock, which is trading at $18.52, has climbed 73% over the past six months despite a 16% decline year to date. Independent analysis places a Fair Value for the company at $21.32, suggesting the shares may be undervalued at current levels.
The company reported a revenue beat of $13 million, driven primarily by record global pump shipments. Adjusted EBITDA margin also exceeded expectations, coming in 250 basis points above forecasts. For fiscal 2026 management guided to total sales growth of 5% to 7% year over year, below Street estimates of about 8.5%. EBITDA margin guidance was set at 5% to 6%, versus the Street estimate of 5.2%.
U.S. revenue guidance is $730 million to $745 million. Management attributes the U.S. outlook to pump shipments growing 10% to 11% year over year and higher consumables sales moved through the pharmacy channel. These positives are offset by a $70 million to $80 million headwind resulting from a shift in sales mix - roughly 20% of pumps sold are expected to migrate from durable medical equipment (DME) to pharmacy under a pay-as-you-go model.
Outside the U.S., leadership is projecting $335 million to $340 million in sales. That guidance reflects a continued transition to a direct sales model, increasing the share of direct sales from approximately 5% to 15% of international revenue by year-end. The company expects direct sales to carry a roughly 30% higher average selling price, but forecasted results include a $15 million headwind tied to distributor de-stocking and inventory buybacks.
On product adoption, Tandem said renewals remain stable and forecasted that conversions of patients from multiple daily injections to pump therapy should resume growth over 2026. Mizuho noted competitive pressures remain a consideration for future adoption trends. The company reported a 53% gross profit margin, which the firm described as healthy despite ongoing profitability challenges.
Alongside Mizuho’s update, two other large analyst firms adjusted their stances on Tandem. BofA Securities upgraded its rating to Neutral from Underperform, citing the company’s strategic shift toward the pharmacy channel and a pay-as-you-go model that the firm expects will support improved profitability over the next two years. Baird moved its rating to Outperform from Neutral, citing the expected mid-2026 launch of the Mobi-T insulin pump as a material catalyst. Both BofA and Baird have increased their price targets to $30.
The company’s guidance and recent analyst actions paint a picture of mixed near-term dynamics: stronger shipment volumes and margin beats on the one hand, and channel-related headwinds and inventory adjustments on the other. Management’s guidance implies modest revenue growth and incremental EBITDA margin improvement in fiscal 2026, but the extent of recovery in new pump conversions and the competitive landscape will influence outcomes.
Summary: Mizuho raised its price target to $22 and maintained a Neutral rating after Tandem reported a $13 million revenue beat driven by record pump shipments and an adjusted EBITDA margin 250 basis points above expectations. Fiscal 2026 guidance calls for 5% to 7% revenue growth and 5% to 6% EBITDA margins, with notable channel and inventory headwinds in both U.S. and international markets.