TransMedics Group (TMDX) PT Lowered to $104 at Canaccord Genuity

Canaccord Genuity analyst Jason Mills lowered the price target on TransMedics Group (NASDAQ: TMDX) to $104.00 (from $109.00) while maintaining a Buy rating.

The analyst commented: "Last Friday, we hosted an investor site visit at TransMedics’ headquarters in Andover, MA which, included a Q&A session with CEO Waleed Hassanein, CFO Stephen Gordon, CCO Tamer Khayal, and Senior VP of Supply Chain & Operations Nick Corcoran. The site visit also included a tour of a busy NOP/aviation command center, on-site manufacturing, and TMDX’s New England NOP hub (all located in the same building). The main takeaway from our discussion with management, in our view, was that management is not expecting its next large growth inflection until Q3/25, driven by clinical trials of its next generation solution technology in both heart and liver. Interestingly, the company is de-emphasizing its work in cold heart perfusion, but instead focusing on the improvements it is seeking to make in heart and lung warm perfusate solution – with the next iterations of its technology aimed at allowing for prolonged storage to enable morning transplant surgeries, similar to what it is seeing in liver today. TransMedics believes there is a strong value proposition for prolonged storage with improvement in the quality of life for transplant surgeons, but also help address staffing/capacity issues as it can lead to increased efficiency for transplant centers. However, until the first of these two IDEs in lung or heart starts (exact cadence & timing TBD), TransMedics is expecting that its growth will continue to reflect more market dynamics (as we saw in the Q3 miss), with an expectation for a revenue benefit from the trials starting in Q3/25. The company was clear that the pathway toward its 10,000-organ transplant goal for 2028 is not expected to be linear, but rather a step-function with periods of market growth and then further acceleration driven by its ongoing clinical work. We expect that the company will provide more formal detailed plans for its clinical programs and financial guidance on this at its December 10th analyst day in New York City. In this note, we have also included some additional analysis on historical market share adoption/penetration to support our updated financial expectations as well as a brief overview of the existing competitive environment to provide investors with more clarity on the overall competitive landscape. Lastly, we are updating our model to reflect stable market share by organ and segment (DCD and DBD) and a slower ramp in aviation, the net effect of which is to lower our forward revenue and EPS estimates."

You May Also Be Interested In

• Fiserv (FISV) PT Lowered to $60 at Freedom Broker
• Boeing lands two U.S. defense contracts worth over $711M
• Cantor Fitzgerald Reiterates Overweight Rating on Merlin Labs (MRLN)