🤖📈 Today's Top Trade Ideas (August 9)

TransMedics Group, Inc. (TMDX) posted an impressive Q2 performance, registering a 156% YoY surge in revenues, marking its best Q2 figures ever. Over the last 18 months, the stock has appreciated by 263%. The company aims to ensure 100% coverage across the U.S. by next year and is expanding its air logistics capabilities, planning to have 15 aircraft, supported by a central dispatch center in Massachusetts. The acquisition of Summer Aviation positions the company to establish its own aviation network, optimizing profits. TMDX's organ care system (OCS) continues to disrupt the market with considerable YoY growth in lung, heart, and liver transportation sales. Given the firm's projected FY'23 gross margin and potential for strong gross capital returns, coupled with its strategic endeavors, the author reaffirms a bullish stance on TMDX, recommending a buy with a revised price target of $150/share, indicating over 100% return potential.

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The author presents a bullish stance on Alibaba's stock, highlighting its strong momentum after breaking out of a falling wedge pattern and predicting a potential rally up to $120 in the short term and $180 in the next 6-12 months. Despite Alibaba facing challenges in topline growth due to China's economic challenges and regulatory actions, the easing off of the tech sector crackdown and anticipated fiscal stimulus could favor the company. While its core e-commerce segment has plateaued, Alibaba's Cloud and International e-commerce sectors offer significant growth opportunities, with expectations of the cloud business spinning off to unlock shareholder value. Notably, Alibaba's valuation significantly lags behind U.S. mega-tech firms, such as Apple, and is trading at a P/FCF ratio under 9x. The author's valuation model indicates an 84% upside to its fair value, with a conservative five-year price target of $412, suggesting a 34% CAGR return. The robustness of this sentiment is further underlined by improved quant factor grades in "Momentum," "Valuation," and "Growth," and by a "Strong Buy" consensus from both Seeking Alpha's Quant Rating System and Wall Street analysts. Despite near-term uncertainties, the author sees Alibaba as a compelling long-term buy and plans to accumulate more shares surrounding its earnings report.

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Alphabet has broadened its business spectrum beyond Google Search, diversifying into platforms like YouTube and Google Cloud Platform (GCP). Despite challenges from a strong dollar affecting overseas revenues, Alphabet boasts impressive top-line growth, thanks to the resilience of its Search business and stable ad expenditure on YouTube. A prominent driver of growth is GCP, which has shown a year-on-year growth rate of about 30%. With comprehensive solutions similar to its competitors, AWS and Azure, GCP's AI services are being embraced for various applications. YouTube remains a significant asset, with YouTube Shorts and Connected TV as growth drivers, and the potential for premium channel offerings and exclusive content. Moreover, Waymo, Alphabet's autonomous vehicle initiative, is gaining traction, and the company is actively integrating AI capabilities across its product line, emphasizing margin growth and effective spend management. Lastly, Alphabet's valuation remains attractive, aligning with historical standards and showcasing competitiveness when juxtaposed with industry peers.

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