One-glance verdict
Within fair range
$93.49 our estimate vs market $88.88
Wall Street consensus: $97.30 (4.1% higher than our fair-value estimate)
5% below our estimate
Fundamentals snapshot
TransMedics Group, Inc.
TMDX · NGM · Healthcare · Medical Devices
Current price
$88.88
52-week range
$60.10 - $156.00
Market cap
$3.08B
Balance sheet
Watch
7.88x Adequate
Net debt $395.04M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 10.4% last year.
- Reward Returns 36.3% on equity, ahead of 83% of its peers.
- Reward Free cash flow was positive in 1/10 years.
- Risk Forward P/E (38.6x) is higher than trailing (23.0x) - earnings are expected to drop.
What this company does
TransMedics Group, Inc.
TransMedics created a portable machine, like a life-support box, that keeps donor organs such as hearts and lungs in much better condition before a transplant. The company earns money by selling these Organ Care Systems and also by providing the full service of picking up and delivering the organs to hospitals. This technology is important because it could increase the number of usable organs available for patients who desperately need them, potentially leading to more successful transplants.
How the company got here
TransMedics was founded in 1998 by a cardiac surgeon, Dr. Waleed Hassanein, to solve a major problem in organ transplantation. For decades, the standard way to transport organs was to put them on ice in a cooler, a method called cold storage. This old method doesn't preserve organs for very long, limiting how far they can travel and meaning many donated organs go unused. After many years of research, TransMedics developed its Organ Care System (OCS) and began getting approvals from the FDA (the U.S. Food and Drug Administration, which makes sure medical devices are safe and effective) for lungs, hearts, and livers between 2018 and 2022. The company went public (meaning its shares started trading on the stock market) in 2019 to raise money and expand its business.
What it actually does
Imagine a special, portable box that keeps a donor organ 'alive' outside the body. That's what TransMedics' main product, the Organ Care System (OCS), does. Instead of just chilling an organ, the OCS warms it and pumps it with blood, oxygen, and nutrients, mimicking the conditions inside the human body. This keeps the heart beating, the lungs breathing, and the liver producing bile, even while being transported to a patient. This technology allows organs to be preserved longer, travel farther, and be monitored by doctors, which helps increase the number of successful transplants.
Product Revenue
This is the company's core business, making up a little more than half of its total sales. TransMedics sells its Organ Care System (OCS) devices for the heart, lung, and liver directly to hospitals and transplant centers. For each transplant, the hospital also has to buy a set of single-use disposable items that are specific to the organ. This creates an ongoing stream of sales, similar to how a printer company sells both the printer and the ink cartridges.
Service Revenue
This is a large and growing part of the company, representing a significant slice of its total business. Through its National OCS Program (NOP), TransMedics offers a complete service package for organ retrieval. Instead of just selling the OCS device, TransMedics provides the staff, manages the logistics (the detailed coordination of a complex operation), and even operates its own fleet of aircraft to transport the organs. Hospitals and transplant centers pay a fee for this all-in-one service, which simplifies the complex process of getting an organ from a donor to a recipient.
What management is betting on now
The company is focused on becoming a complete transplant services platform, not just a device maker. A major priority is expanding its National OCS Program (NOP) to handle more and more of the organ transplants in the United States. Management is also investing heavily in getting its technology approved for kidneys, which represents a very large opportunity, and expanding its services into Europe. They believe that by controlling the entire process—from the technology to the transportation—they can increase the total number of transplants and become the standard for how organ transplantation is done.
Price history
How the share price has moved
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Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$-41.35M
FY2024 Q4
$6.06M
FY2025 Q1
$-29.89M
FY2025 Q2
$82.53M
FY2025 Q3
$61.95M
FY2025 Q4
$19.00M
FY2026 Q1
$-12.12M
FY2026 Q2
$10.22M
Revenue
$189.95M
Net income
$14.68M
Diluted EPS
0.41
Operating cash flow
$17.31M
Free cash flow
$10.22M
Fetching…
Sources
Revenue
$173.93M
Net income
$7.32M
Diluted EPS
0.20
Operating cash flow
$24.53M
Free cash flow
$-12.12M
Fetching…
Sources
Revenue
$160.76M
Net income
$105.38M
Diluted EPS
2.59
Operating cash flow
$34.51M
Free cash flow
$19.00M
Fetching…
Sources
Revenue
$143.82M
Net income
$24.32M
Diluted EPS
0.66
Operating cash flow
$69.57M
Free cash flow
$61.95M
Fetching…
Sources
Revenue
$157.37M
Net income
$34.91M
Diluted EPS
0.92
Operating cash flow
$91.61M
Free cash flow
$82.53M
Fetching…
Sources
Revenue
$143.54M
Net income
$25.68M
Diluted EPS
0.70
Operating cash flow
$-2.85M
Free cash flow
$-29.89M
Fetching…
Sources
Revenue
$121.62M
Net income
$6.86M
Diluted EPS
0.19
Operating cash flow
$19.66M
Free cash flow
$6.06M
Fetching…
Sources
Revenue
$108.76M
Net income
$4.22M
Diluted EPS
0.12
Operating cash flow
$6.86M
Free cash flow
$-41.35M
Fetching…
Sources
Is it cheap or expensive?
Fair value $93.49 vs current price $88.88
Wall Street consensus is the average analyst price target: $97.30 (4.1% higher than our fair-value estimate).
Our most-likely fair value is $93.49 a share — about 5.2% away from today's price of $88.88, so the stock currently looks fairly priced.
Is it drowning in debt?
Watch
Net debt $395.0M. Interest coverage 7.9x.
Net debt
$395.04M
Interest coverage
7.88x
TransMedics Group, Inc.'s profit covers its interest bill about 7.9 times over. which is stronger than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Watch
Worse cushion
Baseline
Better cushion
TMDX
BASELINE
TransMedics Group, Inc.
Total debt $867.72M Interest coverage 7.88x This is the baseline the peer rows are being compared against.
Total debt $19.25M Interest coverage -2.73x -100% vs TMDX This peer has almost no interest-payment cushion compared with TMDX.
Total debt $351.95M Interest coverage 4.05x -49% vs TMDX Carries about 1.9x less debt cushion than TMDX.
Total debt $1.17B Interest coverage 8.41x +7% vs TMDX Has roughly the same debt cushion as TMDX.
Total debt $29.09M Interest coverage 371.93x +4,621% vs TMDX Carries about 47.2x more debt cushion than TMDX.
Total debt $407.97M Interest coverage 1.01x -87% vs TMDX Carries about 7.8x less debt cushion than TMDX.
What you should know
The case for and against TMDX
3 Rewards
1 Risk
Rewards
-
Revenue grew 10.4% last year.
-
Returns 36.3% on equity, ahead of 83% of its peers.
-
Free cash flow was positive in 1/10 years.
Risks
-
Forward P/E (38.6x) is higher than trailing (23.0x) - earnings are expected to drop.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
23.03x
Forward P/E
38.55x
P/B
5.94x
P/S
4.61x
EV/EBITDA
29.33x
PEG ratio
0.74x
Profitability
How much profit each dollar creates
Gross margin
58.7%
Operating margin
12.5%
Net margin
22.7%
ROE
36.3%
ROA
4.3%
Health
Liquidity and balance-sheet strength
Debt / equity
1.67x
Current ratio
6.62x
Quick ratio
5.87x
Total debt
$867.72M
Total cash
$472.68M
Growth
How the business has been compounding
Revenue TTM
$668.47M
Revenue 5Y CAGR
111.5%
EPS TTM
3.86
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$145.93M
Free CF TTM
$133.59M
FCF margin
20.0%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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