Canaccord Genuity raised its price target for TransMedics Group (NASDAQ:TMDX) to $79 from $46, saying the company has the “technology that will become the standard of care for organ transplant and in the process facilitating a significant increase in supply of implantable donated organs to address excess demand.”
Shares of TransMedics closed at $36.22 on March 12.
“2021 is expected to be a transformational year [for TransMedics] with the expected FDA PMA approvals for both OCS Heart and OCS Liver, adding to the already approved OCS Lung,” writes analyst William Plovanic.
Among other things, Mr. Plovanic pointed to a recent decision by CMS to incentivize organ utilization rates, which TransMedics addresses via its service model offering known as the OCS National Program.
He said his new price target is based on a multiple of 21.1 times enterprise value/sales, in-line with the median high-growth (more than 25%) med-tech comp group, applied to a 2022 sales estimate of $104.2-million.
“We are raising the multiple based on our assumption of a positive OCS Heart panel meeting [on April 6] and U.S. launch for both OCS Heart and OCS Liver over the next 12 months,” he added.
