The Resilient Market Paradox: Why Stocks Keep Holding Up Despite Chaos

**SPEAKER_1** (0:03)
On radio, on YouTube, streaming live on investalk.com, and for our podcast subscribers, this is Invest Talk, independent thinking, shared success.
Invest Talk is made possible by KPP Financial, a registered investment advisor firm, serving clients throughout the United States. Here is KPP Financial portfolio manager, Luke Guerrero.

**Luke Guerrero** (0:35)
Good afternoon, fellow investors, and welcome to the Thursday, April 16th, 2026 edition of Invest Talk.
I'm your host, Luke Guerrero, and I'll be with you for the next hour when we dive into what happened in the market today and bring you a bunch of important stories you need to know. That being said, before we do all of those things I just mentioned, let's tackle this caller question now.

**SPEAKER_3** (1:05)
Hi, Justin and Luke. This is Andrew. Appreciate everything you do. Calling to ask about a stock called TransMedics, stock ticker TMDX. They're in the organ care, transportation industry. They provide the end-to-end services, everything from harvesting to transportation.
Just kind of wondering what your thoughts are on the overall future of the stock. I've taken profits along the way, but still pretty big percentage of micro-for layup. So just curious what you guys think about the stock and I'll be listening to the show. Thanks.

**Luke Guerrero** (1:35)
TMDX, which is TransMedics Group, Inc. is a $4 billion medical technology company that focuses on the commercialization of organ care systems. So they have a portable perfusion platform that keeps donor hearts, donor livers, donor lungs, viable outside of the body. Last quarter, it looks like revenue was up 32% year over year, beat by about 3%.
Earnings per share beat by about 40%. The full year 2025 revenue was up 37% year over year.
Margins, gross margins specifically expanded to 60%.
The first full year of positive cashflow. And off of a year that was very solid for them, they guided revenue that was 20 to 25% year over year growth in 2026 with long-term targets that they say could move operation margin to about 30% by 2028 Now in terms of where it's been trading, TMDX did hit a local high in February, the end of February. It was trading about 145 per share before pulling back to where it is right now, 109 after actually being down 6% today. A lot of places are cutting their price targets in early April after multiple insiders were selling shares in March, that added on to near-term pressure. And so if you want to be in this name, where you're hoping that because it's the only FDA cleared warm perfusion system on the market for all of those organs that I mentioned, because of their proprietary logistics network, that it's close to impossible to replicate, but the downside is sequential declines in aviation metrics, gross margin misses and questions about scaling. They've raised doubts and it's currently sitting at a 41 times price to forward-looking earnings multiple. So growth deceleration is going to be brutally punished. Now they do have FDA approval for their next-gen system in hand. They have positive clinical data. Maybe that resets the growth narrative. I would say clearly this is an undeniable category creator in transplant medicine. They have a defensible moat, but the stock needs clean execution on its 20 to 25 percent guide and progress in their kidney platform. They have earnings coming up on May 5th where they will be reporting. And so it's going to be interesting to see how well they've been able to stick to that 2026 momentum coming out of a stellar year. I would say with a name that's this big, if it's a significant part of your portfolio, the momentum is pretty poor. I hope that you're up a good amount. I would think of trimming my position. Thanks for the call. Looks like we had a live call. It's going to Mark from New York. How can I help you?

**SPEAKER_4** (4:29)
Yep, I'm here. I'm sorry about that. I was on mute.

**Luke Guerrero** (4:32)
Oh, not a problem.

**SPEAKER_4** (4:33)
Thank you for everything you do every day, Luke. Appreciate it. Looking at the ticker symbol ARXS, that's ARXS, the IPO today and wondering what you guys think about it and if this is a good entry point or whether or not I should wait.

**Luke Guerrero** (4:49)
Yeah, so ARXS, Inc. is, it looks like it's a PE-backed designer and manufacturing company. They focus on mission-critical electronics and mechanical components.
So I think microwave products, sensors, bearings, seals, and their hope is that their products will be bolstered by spending in space, aerospace and defense spending, medtech, and their semiconductor testing platforms. But if you've been listening to the show, you know the number one warning I give about companies like this is that historically speaking, on average, IPOs have negative expected returns in the first year.