Terns Pharmaceuticals Inc. Common Stock (TERN)

FairStock Score: 26/100 — RISKY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

As a value investor, I start with the business, not the story. Terns is a clinical-stage biopharmaceutical company with 59 employees and no marketed products; its value rests on TERN-701 in Phase 1/2 for CML and TERN-501 in development for oncology and obesity. That is not a durable moat I can underwrite from the provided figures. The financials show the strain: trailing free cash flow is -$82.2M, FCF yield -1.3%, P/E -51.41 at the 2026-05-15 close, ROE -14.23%, and ROCE -9.91%. The provided profit-growth figure is negative, though no period is given. The Piotroski F-Score is 2/9, and the FairStock Score is 26/100. The one clear balance-sheet positive is D/E of 0.00—no debt—but that does not offset cash burn. At $52.95, market cap is $6.1B, P/B 5.91, and the shares sit near the top of a 52-week range of $6.99–$53.19. Graham would ask for a margin of safety; here there is none in current earnings or cash flow. Buffett would ask whether the pipeline is inside a circle of competence and whether the market price already discounts success. The Lynch category is none because only 0 years of filed results are available, needing 3. Altman Z-Score 197.61 looks high but is not a substitute for profits. Growth is a binary clinical-trial option, not a demonstrated earnings stream. I can watch and admire the science, but the numbers do not support a value case at this price.

In plain English: Terns Pharmaceuticals is a small clinical-stage drug developer working on experimental medicines for leukemia and obesity. It has no product sales yet and is losing money, with negative cash flow, so the business looks weak on its current financial numbers. At $52.95, the price looks expensive compared with those numbers, and the stock is much closer to its 52-week high than its low.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-05-15 close · note generated 2026-10-15 · model deepseek-flash

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer