Mizuho analysts have spotlighted two public companies within the precision oncology diagnostics complex that they believe present compelling opportunities for investors heading into the second quarter earnings window. The call comes as stocks in this specialized diagnostics niche have moved unevenly since May 1, with some firms rallying on company-specific news while others have declined.
Against that backdrop, Mizuho identifies Tempus AI and Guardant Health as names with differentiated entry characteristics based on upcoming catalysts, medium-term growth prospects, and potential upside to current consensus forecasts.
Tempus AI
Mizuho views Tempus AI (TEM) as undervalued within the precision oncology diagnostics cohort. The bank notes that recent weakness in TEM’s stock has been exacerbated by deal dynamics and by optics related to the recently announced PSNL acquisition.
Despite near-term sentiment headwinds, Mizuho retains an Outperform rating on TEM heading into the company’s July 30 after-market close earnings report. The analysts project that Tempus’ portfolio is positioned to deliver sustained revenue growth above 30% compound annual growth rate through at least the long-range planning period, driven primarily by the Oncology Diagnostics and Data and Services businesses.
Mizuho anticipates meaningful upside to estimates through 2027, attributing potential gains to higher average selling prices for therapy selection and favorable profit flow-through. The firm also notes that investors are likely to seek greater clarity on the Insights revenue bridge, specifically regarding AstraZeneca contracting plans for 2027 and beyond.
While Mizuho acknowledges that deal dynamics, market sentiment, and the timing of catalysts could limit near-term share appreciation, the analysts express greater confidence in Tempus’ 2027 opportunity. They highlight a possible acceleration of NeXT Personal sales alongside therapy selection and data and services inflection points as key drivers for longer-term upside.
Separately, Tempus AI recently announced a definitive agreement to acquire Personalis in an all-stock transaction. Following that announcement, Guggenheim increased its price target on the company and Freedom Capital initiated coverage with a Hold rating.
Guardant Health
Guardant Health (GH) has been among the stronger performers in the group, with shares up about 74% since May 1. Mizuho attributes that advance to a string of favorable developments, including FDA approval for an upgraded Guardant360 liquid biopsy test and positive coverage decisions for the Shield blood-based colorectal cancer screening test from both American Cancer Society guidelines and UnitedHealth.
Mizuho also maintains an Outperform rating on Guardant ahead of its July 30 after-market close earnings report. With the shares trading near $150, the firm believes Guardant is setting up for a potentially outsized 2027, driven by inflecting average selling prices for Guardant360 and rising Shield volumes.
On a scenario basis, Mizuho models clinical oncology sales that could approach or exceed $2 billion in 2028 depending on Guardant360 average selling price outcomes. The bank also sees Shield volumes potentially reaching $700 million plus in 2028. The recent UnitedHealth coverage decision for Shield prompted several analyst firms to lift their price targets on Guardant shares.
Bottom line and near-term frame
Mizuho’s work highlights how idiosyncratic catalysts - regulatory approvals, coverage decisions, and deal announcements - are driving a wide dispersion of returns among precision oncology diagnostics stocks. The firm’s preferred names, Tempus AI and Guardant Health, are viewed through a multi-year lens where therapy selection pricing, volume uptake, and data and services monetization form the basis for optimistic 2027-2028 scenarios, even as near-term sentiment and deal optics may constrain immediate upside.
Note: Mizuho’s ratings and scenarios are forward-looking assessments that the firm has publicly stated ahead of both companies’ July 30 after-market close earnings reports.