What we think about TransMedics Group (TMDX)
TransMedics Group in Three Words: Organs as a Service
Breaking Update: Scorpion published a short report on TransMedics on Jan 10 that included a "$0 Price Target. 7investing believes Scorpion is relying on incendiary language and anecdotal quotes to incite fear, uncertainty, and doubt in order to profit from their short position.
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Background
TransMedics is playing an important role in saving the lives of thousands of Americans every year. As the inventor of its patented Organ Care System (OCS), it is the only FDA-approved technology to transport lungs, hearts, and livers within the United States.
When a registered donor becomes deceased due to either brain or circulatory death, its OCS keeps their organs functional and vital long enough to be transplanted into another patient anywhere in the country. It is significantly more effective – and is even less expensive – at keeping organs alive and healthy as compared to competing technologies such as the abdominal normothermic regional perfusion (A-NRP).
In addition to developing the OCS, TransMedics also recognized that time is of the essence in this life-or-death industry. Transplants need to happen as quickly as possible, so logistical efficiency would be just as important as organ preservation. As such, TransMedics is buying its own fleet of private aircraft and is training its own in-house pilots to deliver the organs to exactly where they are needed. Its National OCS Program (NOP) is essentially “organ transplant as a service”, handling everything that’s required to get a healthy organ from the donor directly into the hands of the transplant surgeon.
In the words of its founder and CEO Waleed Hassanein:
"Transmedics does two essential things: it keeps donors’ organs alive and healthy for much longer than any other product on the market. And it solves all the logistics involved in recovering the organ, transporting it to where it needs to go, and servicing it fully in accordance to all health-care-standards, all the while keeping it in the best condition possible until it begins its second journey in the body of another human… whose life the organ will save.
It’s a genuine miracle and I want you to acknowledge it!"
TransMedics is headquartered in Andover, Maryland and has 501 employees.
Conviction Update:
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Thoughts on Current Valuation and Capital Allocation
I believe TransMedics' stock will be worth $120 by fiscal 2028. With shares recently trading at around $60, that would conservatively result in a double within the next four years.
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Recent Company Updates
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October 30, 2025
TransMedics appears to be far ahead of schedule in its ambitions of delivering 10,000 donated organs annually by the year 2028. At its current pace, it looks to be on track to deliver 14,000+ during that year.
The excellent execution has been extraordinary for equity investors. $TMDX has generated $115 million of free cash flow during the first nine months of 2025.
And that's after paying for not only all of its operating expenses, but also all of its capital expenditures for their 21 aircraft and flight hubs.
This is no longer just a noble and life-saving concept. It is now a thriving and very profitable business.
By my math, TransMedics looks poised to do at least $1.2 billion in revenue and $6 of earnings per share by Fiscal 2028. Which would easily support a stock price of $180+ within the next three years.