Terns Pharmaceuticals (TERN): Evaluating Rich Valuation After CARDINAL Trial Update and 2025 ASH Presentation

Terns Pharmaceuticals (TERN) is back on radar after updated data from its CARDINAL trial of TERN-701 in previously treated chronic myeloid leukemia was highlighted in an oral session at the 2025 ASH meeting.

See our latest analysis for Terns Pharmaceuticals.

The ASH spotlight has clearly intensified interest in Terns, with a 1 month share price return of 117.81 percent and a 90 day share price return of 432.85 percent helping drive a powerful year to date surge. At the same time, a 3 year total shareholder return of 613.30 percent points to momentum that has been steadily building rather than a one off spike.

If this kind of clinical driven move has your attention, it could be a good moment to explore other potential ideas across healthcare stocks and see what else is setting up for the next leg higher.

With shares now trading above consensus targets after a parabolic run, the key question is whether CARDINAL data can justify even loftier expectations or if the market has already priced in Terns next leg of growth.

Price-to-Book of 12.8x: Is it justified?

Terns Pharmaceuticals last closed at $40.23, and on a price-to-book ratio of 12.8x the stock screens as expensive relative to peers and the wider US pharmaceuticals space.

The price-to-book multiple compares a company’s market value to its net assets on the balance sheet. It can be a useful yardstick for asset light, early stage biopharma names that have little or no revenue but significant R and D investment already capitalised by public markets.

In this case, Terns trades on a 12.8x price-to-book ratio, more than double the peer average of 5x and far above the US pharmaceuticals industry average of 2.6x. This implies investors are paying a substantial premium for the pipeline and future optionality rather than any current fundamentals.

That gap is stark and it underlines how much of Terns value now rests on continued positive CML data and eventual commercial execution rather than on today’s balance sheet or income statement. This leaves far less room for disappointment if trial outcomes or timelines slip.

See what the numbers say about this price — find out in our valuation breakdown.

Result: Price-to-Book of 12.8x (OVERVALUED)

However, stretched valuation, limited revenue, and any setback in CARDINAL or the broader oncology and obesity pipeline could quickly challenge the current bullish narrative.

Find out about the key risks to this Terns Pharmaceuticals narrative.

Build Your Own Terns Pharmaceuticals Narrative

If you see the story differently or want to stress test these assumptions with your own inputs, you can build a personalized view in under three minutes: Do it your way.

A great starting point for your Terns Pharmaceuticals research is our analysis highlighting 4 important warning signs that could impact your investment decision.

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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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