Tempus AI Inc (NASDAQ:TEM) shares are trading higher by 7.45% to $35.82 during Tuesday's session after the company announced it was granted Advanced Diagnostic Laboratory Test (ADLT) status for its next-generation sequencing assay from the Centers for Medicare & Medicaid Services.

The company says this makes xT CDx the first FDA-approved sequencing assay to provide tumor mutation profiling through matched normal sequence analysis for patients with solid organ neoplasms.

The ADLT status additionally confirms that xT CDx meets CMS's criteria for providing unique clinical diagnostic information. The initial reimbursement rate set by CMS is $4,500, applicable from July 1, 2024, to March 31, 2025. After this period, CMS will determine a new Medicare rate based on the median private payer amounts.

Ezra Cohen, MD, Chief Medical Officer of Oncology at Tempus, highlighted that this designation supports Tempus's mission to enhance patient care through precision medicine and high-quality clinical testing.

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Is TEM A Good Stock To Buy?

An investor can make a few decisions when deciding whether a stock is a good buy. In addition to valuation metrics and price action which you can find on Benzinga's quote pages – like Tempus AI's page for example – there are factors like whether or not a company pays a dividend or buys a large portion of its stock each quarter.

These are known as capital allocation programs. Tempus AI does not pay a dividend, but obviously has a few ways it can return value to shareholders. Feel free to search Benzinga's dividend calendar for the next company that is due to pay a dividend and determine what kind of yield you can earn for holding a share of the company.

For example, if you're looking to earn an annualized return of 14.97%, you'll need to buy a share of Global Net Lease by the Jul. 11, 2024. Once done, you can expect to receive a nominal payout of $0.28 on Jul. 16, 2024.

Buyback programs are obviously different and highly variable. A company can approve a buyback program and purchase shares as it sees fit over the course of time in which the buyback was authorized. Looking through the latest news on Tempus AI will often yield whether or not the company has approved a buyback program recently. Buyback programs usually serve as a support for share prices, serving as a backstop for demand.

According to data from Benzinga Pro, TEM has a 52-week high of $43.88 and a 52-week low of $22.89.