Medical Stock Nears Buy Point Amid Liver Transplant Demand Surge

TransMedics Group (TMDX) has been experiencing robust demand for its technology and services, which has supported recent gains for the medical stock. Thursday’s IBD 50 Stock To Watch is now eyeing a buy point in an early-stage pattern.

The medical stock has formed a cup-with-handle base with a buy point of 151.85. Shares nearly doubled in 2025 and its gain so far in 2026 is outperforming the S&P 500’s loss of more than 1%.

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TransMedics creates technology for lung, heart, and liver transplants. It also offers services for procuring organs and arranging logistics for their transport. Its Organ Care System technology platform has been approved by the Food and Drug Administration. The OCS platform allows organs to be stored in a warm and functioning state before transplant, overcoming the limits of cold storage.

The company operates through a network of 17 regional hubs across the U.S. that support the air and ground transportation of organs.

Demand for its products and services has helped the company turn a profit over the past two years, with earnings more than doubling in the three most recent quarters.

TransMedics Trounces Earnings Estimates

TransMedics stock’s cup-with-handle base is in its first stage. Investor’s Business Daily research shows that early-stage bases tend to lead to more successful breakouts and solid gains than later ones.

The company in late February posted fourth-quarter profit that blew past analysts’ estimates. Net earnings surged more than 1000% to $2.62 per share from 19 cents per share a year ago. Wall Street was looking for a relatively modest 36 cents per share.

TransMedics on Feb. 24 said fourth-quarter sales grew 32% to $161 million. The result was lower than analysts’ target of $174 million.

Both product sales and service revenue grew from the prior year. Growth was seen across all service components, include clinical services, logistics and transport, and aircraft operations. OCS support for liver transplants showed an uptick in sales although those for lung and heart transplants declined from the prior quarter.

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After two years of triple-digit expansion, analysts expect earnings growth to decelerate in 2026. Estimates indicate a 47% decline in 2026 profit to $2.56 per share from a year earlier. However, analysts expect the profit pace to pick up in 2027, with a 45% increase to $3.71 per share.

For 2026, TransMedics gave revenue guidance of $742 million at the midpoint. The FactSet consensus estimate is $737.5 million.

Medical Stock Leads Group

TransMedics stock ranks fourth in the medical products group, according to IBD Stock Checkup.

The medical stock has a Composite Rating of 96 out of 99. Its Relative Strength Rating of 89 shows the  stock has performed better than the vast majority of stocks in the Investor’s Business Daily database over the past 52 weeks. As of Wednesday, the stock had gained 21% year to date.

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Its Earnings Per Share Rating of 83 meets the minimum recommended rating of 80.

Mutual funds have been net buyers of the stock over the past 13 weeks, giving shares an Accumulation/Distribution Rating of B+. Funds own 76% of outstanding shares. An increasing number of funds have bought the stock in five out of the past seven quarters.

In the IBD mutual fund index,  the Lord Abbett Developing Growth Fund (LAGWX) and the Invesco Discovery Fund (OPOCX) hold shares of TransMedics.

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