TransMedics initiated with a Buy at Needham

Needham analyst Mike Matson initiated coverage of TransMedics with a Buy rating and $208 price target. The company’s Organ Care System is supported by extensive clinical data and multiple FDA approvals and is enabling TransMedics to revolutionize the “large” and less than 6% penetrated organ transplant market, the analyst tells investors in a research note. The firm also believes the company’s National OCS Program turnkey organ procurement service has “supercharged its growth.” TransMedics should turn profitable in 2024 and sees “rapid improvements” in its operating margin, earnings and cash flow through 2026, contends Needham. It believes the stock’s valuation is “reasonable” considering the company’s growth rate and potential for upside to consensus estimates.