Looking for stocks with explosive growth potential? Look no further than TransMedics Group (TMDX 1.23%) and Abivax Société Anonyme (ABVX +6.94%). Both healthcare specialists have seen their shares jump significantly this year already.
However, there could be plenty more upside on the way for these little-known stocks. Here's why TransMedics Group and Abivax might be worth considering, especially for investors with an elevated risk tolerance.
1. TransMedics Group
TransMedics Group is helping revolutionize the organ transplant market by solving a key problem. Once they leave their natural habitats (the human body), organs are hard to store and keep in ideal shape for transplants. The traditional cold storage method has poor outcomes.
TransMedics developed the Organ Care System (OCS), a device that mimics the physiology of the human body to maintain organs in optimal condition for transplant. The OCS is cleared for the storage of lungs, hearts, and livers. In a clinical trial, the usage rate for lungs stored in cold storage was 23%, compared to 87% for the OCS. The OCS also leads to fewer post-transplant complications.
So, TransMedics' technology results in less waste, more transplants, and improved health outcomes.
Image source: Getty Images.
Increased adoption of the technology is driving solid financial results for the company, which is one reason the stock has performed so well this year. TransMedics' third-quarter revenue came in at $143.8 million, up 32% compared to the year-ago period. The company's net earnings per share were $0.66, compared to $0.12 reported in the prior-year quarter.
Could TransMedics Group maintain the momentum it has experienced this year? The stock won't double every single year, but there are crucial medium-term growth catalysts to consider.
For instance, TransMedics is expanding its National OCS Program (NOP), a service that handles everything from organ procurement and storage to air transport through the company's own aircraft network, as well as ground transport. TransMedics' NOP has been instrumental in improving the business, as relying on third parties for transport led to a range of issues (there weren't always pilots or planes available when needed, for instance).
NASDAQ: TMDX
Key Data Points
TransMedics recently announced a partnership with Mercedes-Benz to use the famous car company's vehicles for ground transport in Italy. This is part of the company's plan to expand its service in Europe -- international expansions could be a boost to revenue and earnings.
TransMedics Group is also developing a next-generation OCS system, targeting the transplantation of other organs, such as kidneys. In the meantime, the company estimates that organ transplants will continue to grow at a steady pace for at least the next few years. That could grant it plenty of growth fuel to deliver more solid returns along the way.
2. Abivax
Abivax is a France-based, clinical-stage biotech company. The drugmaker's shares soared this year on encouraging late-stage clinical trial results for its leading candidate, obefazimod, which it is developing as a potential medicine for ulcerative colitis (UC).
This isn't an easy market to break into these days. There are many therapies for UC, including some marketed by leading pharmaceutical companies. The list includes AbbVie's Humira and Rinvoq, Eli Lilly's Omvoh, and Johnson & Johnson's Remicade and Stelara, among many others.
However, Abivax could carve out a niche in this highly competitive space. In a pair of phase 3 studies, obefazimod achieved statistically significant remission compared to a placebo in patients with moderate to severe UC. Here's the even better part: Nearly half of the participants in the study (47.3% to be exact) had inadequate responses to prior therapies.
In other words, obefazimod could target a larger pool of patients than many competing medicines, including some of the top-selling ones in this niche. It's not surprising, then, that Abivax, a small-cap stock worth well under $1 billion entering 2025, has gained more than 1,000% since January.
NASDAQ: ABVX
Key Data Points
Abivax is preparing a regulatory submission in the U.S. in the second half of 2026, provided an ongoing maintenance trial also hits the mark. It will also target other indications for obefazimod, including Crohn's disease.
The medicine is clearly promising and should exceed blockbuster status, but is it worth buying Abivax's shares after this year's run? There are significant risks of regulatory setbacks and clinical trial failures. And Abivax is worth 7.5 billion euros ($8.7 billion), which is pretty high for a clinical-stage biotech.
However, given its potential in a large UC market and other indications, there might be plenty more upside left. The stock definitely isn't for risk-averse investors, but those comfortable with heightened volatility might want to consider it, as it could see even more gains moving forward.
