Tandem Diabetes Care (TNDM): How a Device Correction and Legal Scrutiny Shape Valuation Prospects

Tandem Diabetes Care (TNDM) shares took a sharp hit after the company announced a voluntary medical device correction for certain t:slim X2 insulin pumps. This announcement was quickly followed by a securities investigation.

See our latest analysis for Tandem Diabetes Care.

Despite some recent turbulence, Tandem Diabetes Care's share price has rebounded impressively. After falling sharply on news of the device correction, it surged nearly 26% over the past month and is up more than 70% in the last 90 days. That said, momentum remains a recovery story, as the one-year total shareholder return is still down 35%, reflecting ongoing risks but also room for renewed optimism as Tandem navigates product rollouts and leadership changes.

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With shares still well below last year's highs, but recent momentum building and new product launches on the horizon, is Tandem Diabetes Care trading at a compelling discount, or has the market already priced in any future growth?

Most Popular Narrative: 9.8% Undervalued

With Tandem Diabetes Care's fair value pegged at $20.64, about 10% higher than its recent close, analyst narratives see potential upside driven by innovation and market expansion. This sets up a compelling debate about what powers this valuation.

“Broader pharmacy channel expansion and acceleration of pharmacy-based supply sales are expected to lower out-of-pocket costs, increase pump adoption rates, and shift more high-margin recurring supply sales through premium-priced channels, supporting future revenue growth, margin expansion, and improved earnings.”

Read the complete narrative.

What’s fueling this growth thesis? The narrative centers on an ambitious expansion into new markets, next-gen products, and a reinvention of how recurring revenues are captured, all underpinned by a stringent set of profit growth assumptions. Uncover the bold forecasts and tension between projected earnings and the valuation set by consensus. The most eye-catching figures are hidden just below the surface.

Result: Fair Value of $20.64 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, intense competition and delayed benefits from commercial transformation could disrupt Tandem's recovery. This adds uncertainty to the company's near-term growth trajectory.

Find out about the key risks to this Tandem Diabetes Care narrative.

Build Your Own Tandem Diabetes Care Narrative

Curious to see the story differently or want to dive into the numbers yourself? You can shape your own view in just minutes. Do it your way.

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Tandem Diabetes Care.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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