The best lesson learned from failure: why I doubled down on this healthcare tech stock

The most painful moments of investment are often the times when you reap the greatest rewards.

Back in 2014, I sold all my AMZN shares because I was not optimistic about Amazon's Fire Phone, and then I watched it soar 14 times. At that time, I didn't understand a key principle: the failure of an excellent founder's product does not represent the failure of the company. Bezos's willingness to take risks led to gold medal businesses like AWS, Prime, and Whole Foods.

This lesson is perfectly illustrated by the medical technology company TransMedics (TMDX) that I currently hold.

In August 2023, when the management announced the acquisition of an airline, I was just as skeptical as the market – is this a money-burning pace? As a result, the stock price was halved. But this time I did not repeat the same mistake and chose to give the founder, Hassanein, some time.

So what? Two years later:

• The stock price has risen threefold from the low point.
• Sales revenue doubled
• Net profit margin reached 17%
• The usage rate of air logistics in organ transplantation has reached 78%.

Core data shines: the latest quarterly transplant revenue increased by 32%, and logistics revenue rose by 35%. The company plans to double the number of transplants from the current level to 10,000 cases, and also to enter the kidney donation and international markets.

Key Insights: Initially, I was “right that the Fire Phone is garbage,” but “wrong that AMZN would collapse.” Similarly, I might be right that “the airline unit will drag down gross margins,” but if I sell TMDX because of that, I will make the same mistake again.

Learn a bit of Warren Buffett's wisdom: it's more enjoyable to learn from others' mistakes than from your own.