ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. TransMedics Group's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was 6.51%.
As of today (2026-06-25), TransMedics Group's WACC % is 20.36%. TransMedics Group's ROC % is 17.26% (calculated using TTM income statement data).
TransMedics Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.
TransMedics Group (NAS:TMDX) ROC % Explanation
ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.
There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.
Why is ROC % important?
Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, TransMedics Group's WACC % is 20.36%. TransMedics Group's ROC % is 17.26% (calculated using TTM income statement data).
TransMedics Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
Like ROE % and ROA %, ROC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
TransMedics Group ROC % Related Terms
TransMedics Group ROC % Historical Data
* Premium members only.
The historical data trend for TransMedics Group's ROC % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Note:
The Operating Income data used here is four times the quarterly (Mar. 2026) data.
The tax rate is limited to between 0% and 100%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
TransMedics Group (TMDX) has a ROC % of 6.51% as of Mar. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on TransMedics Group and its competitors.
Is TransMedics Group's ROC % too high?
TransMedics Group's current ROC % is 6.51%. The Medical Devices & Instruments industry median ROC % is 1.27. TransMedics Group's value of 6.51% is 412.6% above this industry median. Overall, TransMedics Group has a GF Score™ of 69/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does TransMedics Group's ROC % compare to AXGN and ESTA?
TransMedics Group's ROC % of 6.51% can be compared against companies in the Medical Devices & Instruments industry. The industry median ROC % is 1.27. TransMedics Group's value of 6.51% is 412.6% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROC % for a Medical Devices & Instruments company?
The median ROC % among Medical Devices & Instruments companies is 1.27, based on 847 companies in the industry. Companies in the top quartile (top 25%) have a ROC % significantly above this median, while those in the bottom quartile fall well below. However, ROC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. TransMedics Group's current ROC % of 6.51% is 412.6% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROC % mean?
A high ROC % can signal that a stock is expensive relative to its fundamentals. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on TransMedics Group and its competitors. For the Medical Devices & Instruments industry, the median ROC % is 1.27 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. TransMedics Group's current ROC % is 6.51%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is TransMedics Group stock overvalued right now?
Based on GuruFocus' analysis, TransMedics Group (TMDX) is currently considered Possible Value Trap. The stock's GF Value™ is $166.22, compared to a current price of $77.75 — trading 53.2% below its estimated fair value. The current ROC % is 6.51% and 412.6% above the Medical Devices & Instruments industry median of 1.27. TransMedics Group's overall GF Score™ is 69/100 with 9 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROC % calculated?
ROC % is calculated from a company's financial statements. For TransMedics Group (TMDX), the current ROC % is 6.51% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is TransMedics Group (TMDX) Overvalued in 2026?
Based on GuruFocus' analysis, TransMedics Group stock appears to be undervalued.
The current stock price of $77.75 is trading 53.2% below its estimated GF Value™ of $166.22.
GuruFocus considers TransMedics Group to be Possible Value Trap.
Key valuation signals for TMDX:
ROC %: 6.51%
GF Value™: $166.22 vs. price of $77.75 (53.2% below fair value)
Industry Position: 412.6% above the Medical Devices & Instruments median
No single metric tells the full story. See the TMDX stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
TransMedics Group Inc is a commercial-stage medical technology company transforming organ transplant therapy for end-stage organ failure patients across multiple disease states. It has developed the Organ Care System (OCS) to comprehensively address the limitations of cold storage. The OCS is a portable organ perfusion, optimization, and monitoring system that utilizes technology to replicate near-physiologic conditions for donor organs outside of the human body. The company has developed and is commercializing a proprietary system to preserve and deliver human organs for transplant in a near-physiologic condition to address the limitations of cold storage organ preservation.
69GF Score
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