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TransMedics Group Inc (TMDX)
NASDAQ:TMDX
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TransMedics Group
(NASDAQ:TMDX)
70Outperform
Positive Factors
Financial Performance
Transmedics Group reported revenue and earnings per share that exceeded estimates, showcasing strong performance and boosting confidence in the company's stock.
Market Share
TMDX continued to gain share during 2024 and its overall US market share was 20.9% in 2024, which is up from 13.8% in 2023.
Revenue Guidance
The company's guidance for 2025 indicates a significant revenue growth rate of 20%-25%, suggesting strong future prospects.
Negative Factors
Competition
Hold rating maintained given concerns about competition.
Gross Margin
The increase in service revenue mix at a lower gross margin is expected to limit overall gross margin growth in the near term.
Growth Outlook
Investor sentiment will likely remain mixed as the 2025 outlook calls for a deceleration in growth and as investors continue to debate the competitive environment.
TransMedics Group (TMDX) vs. S&P 500 (SPY)
Market Cap
$2.54B
Dividend YieldN/A
Average Volume (3M)1.11M
Price to Earnings (P/E)75.6
Beta (1Y)1.39
Revenue Growth82.74%
EPS GrowthN/A
CountryUS
Employees728
SectorHealthcare
Sector Strength70
IndustryMedical - Devices
Share Statistics
EPS (TTM)1.01
Shares Outstanding33,662,360
10 Day Avg. Volume1,112,045
30 Day Avg. Volume1,112,746
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)5.26
Price to Cash Flow (P/CF)29.60
P/FCF Ratio29.60
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$100.00Price Target Upside24.10% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
TransMedics Group Business Overview & Revenue Model
Company DescriptionTransMedics Group, Inc., a commercial-stage medical technology company, engages in transforming organ transplant therapy for end-stage organ failure patients in the United States and internationally. The company offers Organ Care System (OCS), a portable organ perfusion, optimization, and monitoring system that utilizes its proprietary and customized technology to replicate near-physiologic conditions for donor organs outside of the human body. Its Organ Care System includes OCS LUNG for the preservation of standard criteria donor lungs for double-lung transplantation; OCS Heart, a technology for extracorporeal perfusion and preservation of donor hearts; and OCS Liver for the preservation of donor livers. The company was founded in 1998 and is headquartered in Andover, Massachusetts.
How the Company Makes MoneyTransMedics Group generates revenue primarily through the sale and leasing of its Organ Care System (OCS) products and related consumables. The OCS platform offers a range of specialized modules for different organs, and the company charges healthcare institutions and transplant centers for the use of these systems and the disposable products required for each transplantation procedure. Revenue is also derived from service agreements and maintenance contracts associated with the OCS systems. Additionally, TransMedics may engage in partnerships or collaborations with healthcare organizations and research institutions to further expand its commercial reach and enhance its technological offerings. The company's innovative approach and focus on improving transplant outcomes contribute significantly to its revenue streams.
TransMedics Group Financial Statement Overview
Summary
TransMedics Group has shown strong revenue growth and profitability, with improved gross profit and net profit margins. However, increased debt levels present a leverage risk that needs careful management.Income Statement
TransMedics Group has shown a remarkable improvement in revenue, with a positive trajectory from $23.6M in 2019 to $441.5M in 2024. The Gross Profit Margin has improved significantly, indicating increased efficiency in cost management. The Net Profit Margin turned positive in 2024, showing profitability after years of losses. EBIT and EBITDA margins have also turned positive, reflecting operational improvements.85
Very Positive
Balance Sheet
The company's Debt-to-Equity ratio has increased due to higher debt levels, indicating potential leverage risks. However, the Return on Equity (ROE) has improved due to increased profitability, and the Equity Ratio remains stable, suggesting a balanced capital structure with a significant equity base.70
Positive
Cash Flow
TransMedics Group has improved its Free Cash Flow, turning positive in 2024. The Operating Cash Flow to Net Income ratio indicates strong cash generation relative to net income. The Free Cash Flow to Net Income ratio also shows that the company is generating cash flow that supports its profitability, though historical negative free cash flows highlight past challenges.78
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 441.54M | 241.62M | 93.46M | 30.26M | 25.64M | Gross Profit |
| 262.08M | 154.09M | 65.27M | 21.16M | 16.64M | EBIT |
| 37.50M | -28.73M | -31.44M | -39.43M | -26.38M | EBITDA |
| 69.95M | -7.60M | -28.96M | -38.49M | -23.15M | Net Income Common Stockholders |
| 35.46M | -25.03M | -36.23M | -44.22M | -28.75M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 336.65M | 394.81M | 201.18M | 92.45M | 125.64M | Total Assets |
| 804.08M | 706.05M | 277.15M | 134.89M | 152.03M | Total Debt |
| 458.92M | 515.95M | 67.56M | 8.60M | 34.66M | Net Debt |
| 122.27M | 121.13M | -133.63M | -16.98M | 10.08M | Total Liabilities |
| 575.47M | 568.85M | 89.77M | 67.04M | 48.13M | Stockholders Equity |
| 228.60M | 137.20M | 187.38M | 67.85M | 103.89M |
| Cash Flow | Free Cash Flow | |||
| 48.80M | -192.09M | -57.72M | -32.38M | -30.72M | Operating Cash Flow |
| 48.80M | -13.03M | -45.82M | -28.86M | -30.27M | Investing Cash Flow |
| -129.30M | -193.95M | 54.51M | 29.27M | -41.60M | Financing Cash Flow |
| 22.87M | 400.42M | 167.93M | 1.39M | 75.55M |
TransMedics Group Technical Analysis
Positive
80.58
Price Trends
70.80
Positive
69.70
Positive
105.19
Negative
Market Momentum
-0.23
Positive
47.68
Neutral
29.28
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TMDX, the sentiment is Positive. The current price of 80.58 is above the 20-day moving average (MA) of 70.66, above the 50-day MA of 70.80, and below the 200-day MA of 105.19, indicating a neutral trend. The MACD of -0.23 indicates Positive momentum. The RSI at 47.68 is Neutral, neither overbought nor oversold. The STOCH value of 29.28 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TMDX.
TransMedics Group Risk Analysis
TransMedics Group disclosed 71 risk factors in its most recent earnings report. TransMedics Group reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
TransMedics Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (48)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $2.54B | 75.60 | 19.39% | ― | 82.74% | ― | |
67 Neutral | $1.63B | 27.07 | 18.76% | ― | 26.08% | 30.54% | |
63 Neutral | $2.78B | ― | -26.77% | ― | 64.84% | 21.67% | |
56 Neutral | $1.94B | 29.73 | 4.87% | ― | 8.33% | 256.54% | |
52 Neutral | $1.48B | ― | -0.44% | ― | 4.47% | -110.70% | |
48 Neutral | $6.25B | 1.14 | -46.26% | 2.69% | 19.24% | 1.75% | |
46 Neutral | $1.00B | ― | -4.78% | ― | 9.75% | 57.91% |
* Healthcare Sector Average
Performance Comparison
TMDX
TransMedics Group
80.58
-11.24
-12.24%
AORT
Artivion
23.37
3.02
14.84%
IART
Integra Lifesciences
16.99
-15.07
-47.01%
UFPT
Ufp Technologies
209.42
-19.32
-8.45%
LIVN
LivaNova
33.96
-19.41
-36.37%
PRCT
PROCEPT BioRobotics
52.07
1.47
2.91%
TransMedics Group Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: 11.73% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Positive
TransMedics' earnings call reflects strong financial performance and market share gains, particularly in the U.S., with significant revenue growth and operational improvements. However, there are challenges in gross margin, international revenue, and potential operational hurdles. The company has addressed recent allegations but faces variability in logistics and clinical program timelines.Highlights
Record Revenue Growth
Total revenue for Q4 2024 was $121.6 million, representing approximately 50% growth year-over-year and 12% sequential growth from Q3 2024. Full year 2024 revenue was $441.5 million, an 83% growth over 2023.
Strong U.S. Performance
U.S. revenue grew 11% sequentially to $117 million in Q4 2024, while full year U.S. revenue reached $422 million, representing approximately 91% growth over 2023.
Operating Profit and Cash Flow
TransMedics delivered an operating profit of $8.6 million in Q4 2024 and $37.5 million for the full year, marking its first year of positive cash flow from operating activities, generating $48.8 million.
Increased Market Share in Organ Transplants
OCS U.S. market share across all three organs was 20.9% for full year 2024, up from 13.8% in 2023. Liver market share increased from 17% to 27%, heart market share from 16% to 19%.
Expansion of Logistics Infrastructure
TransMedics expanded its fleet to 19 aircraft by the end of Q4 2024, with plans to increase to 22 in 2025, improving logistics and operational efficiency.
Lowlights
Gross Margin Challenges
Overall gross margin for full year 2024 was 59.4%, down from 63.8% in 2023 due to a higher contribution of lower-margin service revenue.
Investigation and Allegations
TransMedics was the target of a short report with serious allegations. An independent investigation found no evidence of fraud or misconduct, but the situation created negative attention.
Potential Operational Challenges
Unexpected aircraft maintenance may impact logistics availability and create variability in service margins, and there are uncertainties about the timing of launching new clinical programs.
Flat International Revenue
International revenue was relatively flat year-over-year at $15 million, indicating limited growth outside the U.S. due to variable reimbursement.
Company Guidance
During the TransMedics Fourth Quarter and Full Year 2024 Earnings Conference Call, the company provided guidance for 2025, projecting total revenue between $530 million and $552 million, implying a 20% to 25% growth over 2024. The call detailed TransMedics’ strong performance in 2024, with total revenue reaching $441.5 million, an 83% increase from 2023. The U.S. market drove this growth, with revenue surging to $422 million, a 91% increase. Operational highlights for Q4 included total revenue of $121.6 million, a year-over-year growth of approximately 50%, and a sequential increase of 12%. The company also achieved an overall gross margin of 59% and an operating profit of $8.6 million for the quarter. For 2024, the gross margin stood at 59.4%, slightly down from 63.8% in 2023 due to the higher contribution of service revenue. TransMedics demonstrated strong operational leverage, achieving a full-year operating profit of $37.5 million, marking its first year of positive cash flow from operating activities with $48.8 million generated. The company anticipates continued growth, driven by increased Organ Care System (OCS) adoption and service revenue, and plans to further invest in its next-generation technology platform and business infrastructure to ensure scalability.TransMedics Group Corporate Events
Executive/Board ChangesBusiness Operations and StrategyFinancial Disclosures
TransMedics Group Appoints New CFO Amid Growth Forecast
Positive
Dec 2, 2024
TransMedics Group, Inc. has appointed Gerardo Hernandez as the new Chief Financial Officer, effective December 2, 2024, succeeding Stephen Gordon. Hernandez brings over 25 years of financial experience across healthcare and consumer sectors, having previously held significant roles at Alnylam Pharmaceuticals and Shire. The company also updated its 2024 financial outlook, projecting substantial revenue growth. This strategic leadership change aims to enhance TransMedics’ operations and expand its market influence in organ transplantation technologies.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.