This MedTech Company Has Market Expansion Opportunity, Says Bullish Analyst

TransMedics Group Inc (NASDAQ:TMDX) shares were climbing in early trading on Tuesday.

The clinical trials for the company's Organ Care Systems for the heart, lung and liver have shown strong data, which is expected to continue to drive adoption, according to Stephens.

The TransMedics Analyst: George Sellers initiated coverage of TransMedics with an Overweight rating and price target of $151.

The TransMedics Thesis: The current waiting list for heart, lung and liver transplants represents the near-term expansion opportunity, which equates to $920 million, Sellers said in an initiation note.

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"Longer-term, if the market utilization rate increases to TMDX’s rates and every new waitlist patient receives a transplant, then the annual opportunity is $1.5 bil. (vs. ~$1.1 bil. in 2023) growing low-single digits annually," the analyst wrote.

The kidney transplant market represents an additional market expansion opportunity, as its volume is 6x the combined heart, lung, and liver transplant volume, he added.

"We believe TMDX has significant runway to inflect to positive cash flow while also investing in the continued growth of the business," Sellers further stated.

TMDX Price Action: Shares of TransMedics had risen by 0.34% to $134.09 at the time of publication on Tuesday.

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