What Happened?
Shares of diabetes technology company Tandem Diabetes Care (NASDAQ: TNDM) jumped 4.5% in the afternoon session after an analyst at Morgan Stanley raised the firm's price target for the stock. The firm's analyst, Patrick Wood, kept an 'Equal-Weight' rating on Tandem Diabetes Care but increased the price target by over 35%, moving it from $17.00 to $23.00. This adjustment suggested a more positive outlook on the stock's value, even while the overall rating remained neutral. The action indicated that the analyst saw more potential upside for the company's shares than previously estimated.
After the initial pop the shares cooled down to $20.33, up 3.6% from previous close.
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What Is The Market Telling Us
Tandem Diabetes’s shares are extremely volatile and have had 43 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 12 days ago when the stock gained 9.5% on the news that comments from a key Federal Reserve official bolstered hopes for an interest rate cut. New York Federal Reserve President John Williams stated he sees “room for a further adjustment” in the near term, sparking a significant market rally. Following his remarks, the probability of the central bank cutting rates at its December meeting jumped from 39% to over 73%, according to the CME FedWatch tool. This positive sentiment provided relief to markets amid concerns over high valuations, particularly in AI-related stocks.
Tandem Diabetes is down 43.3% since the beginning of the year, and at $20.33 per share, it is trading 45.8% below its 52-week high of $37.53 from January 2025. Investors who bought $1,000 worth of Tandem Diabetes’s shares 5 years ago would now be looking at an investment worth $211.73.
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