TransMedics Group, Inc. (TMDX) started the week on a sour note, falling short of market expectations for its third-quarter earnings. The company reported earnings of 12 cents per share, significantly lower than the anticipated 30 cents per share, as per analyst consensus. Revenue also failed to meet expectations, coming in at $108.76 million compared to the estimated $115.00 million.
Despite the disappointing results, TransMedics remains optimistic about its future performance. “We are proud of our performance year to date and look forward to ending 2024 on a strong note,” stated Waleed Hassanein, president and CEO of TransMedics. “We continued to make meaningful progress across each of our growth initiatives through the third quarter and maintain our conviction in our growth runway for 2025 and beyond.” The company also reiterated its full-year revenue forecast, projecting it to fall within the range of $425 million to $445 million, in line with analyst estimates of $444.36 million.
The market’s reaction to the earnings announcement was mixed. While TransMedics shares rose slightly, closing 0.9% higher at $126.24 on Monday, analysts reacted by adjusting their price targets for the stock.
Needham analyst Mike Matson maintained his Buy rating on TransMedics but lowered his price target from $208 to $109. Baird analyst Joe Vruwink also maintained his Outperform rating but reduced his price target from $200 to $150. Canaccord Genuity analyst Jason Mills kept his Buy rating while lowering his price target from $169 to $109.
The adjustments to price targets reflect the analysts’ cautious approach, taking into account the earnings miss while also considering the company’s long-term growth potential. Despite the challenges presented by the third-quarter results, investors will be closely watching how TransMedics navigates the remainder of the year and performs in 2025 to see if it can meet its ambitious growth goals.
