Jefferies raises Tarsus Pharmaceuticals price target on guidance

Jefferies recently increased its price target for Tarsus Pharmaceuticals (NASDAQ:TARS) stock to $105 from $88, retaining a Buy rating. As of now, the stock is trading at $89.69, having delivered a 60% return over the past year and surged 23% in the last week. The firm's rationale for the revised target includes the company's enhanced Xdemvy guidance for 2026 and recent prescribing data indicating a robust third quarter.

Tarsus Pharmaceuticals boosted its Xdemvy forecast following its second-quarter earnings report. The move comes as the company announced the acquisition of Alkeus, which adds a Phase III-ready rare-disease asset to its pipeline, with the potential to generate sales of up to $1 billion. Additionally, Tarsus Pharmaceuticals has secured the iRenix deal, further bolstering its portfolio with another Phase III asset. The company is presently valued at roughly $4 billion.

According to InvestingPro analysis, Tarsus Pharmaceuticals appears to be undervalued, with a Fair Value of $98, suggesting further upside potential beyond Jefferies' target price. For a more detailed evaluation, investors can explore TARS's comprehensive Pro Research Report, which is among 1,400+ reports available on the platform.

Jefferies highlighted that the stock remains affordable in the long term, given the multiple pipeline data readouts expected within the next one to three years and the enduring strength of the Xdemvy business.

Recently, Tarsus Pharmaceuticals disclosed its second-quarter 2026 earnings, achieving net product sales of $173.9 million, exceeding analysts' projections of $167.33 million. However, the company reported a loss of $0.43 per share, which was greater than the estimated loss of $0.22. Despite the earnings per share shortfall, Tarsus Pharmaceuticals raised its full-year sales guidance for its eye drug, XDEM Vy, which has generated approximately $1 billion in cumulative sales since its introduction.

Furthermore, the global biotech funding sector has experienced a 75% increase year-over-year, propelled by initial public offerings (up 235%) and follow-on offerings (up 138%), underscoring heightened activity and enthusiasm in the biotech industry.