Teladoc Stock Forecast 2023
TDOC stock forecast: Latest Price
Teladoc Health, Inc. provides virtual healthcare services in the United States and internationally. The company offers a portfolio of services and solutions covering non-urgent, episodic, chronic, and complicated medical conditions. It offers its products and services under the Teladoc, Livongo, and BetterHelp brands. The company was formerly known as Teladoc Inc. and changed its name to Teladoc Health, Inc. in August 2018. The company was incorporated in 2002 and is headquartered in Purchase, New York.
Teladoc Stock Forecast: Latest News
- Michael Willem Waters, COO of Teladoc, recently sold 19,340 shares in Teladoc Health for a total of $522,741. Following the filing of Form 4 with the SEC, Waters now holds a total of 25,937 shares in the company, with all 25,937 shares held directly.
- Teladoc Health is taking a proactive approach to incorporate AI into their business foundation, using it to enhance their products and experiences for members. They’ve initiated an Innovation via AI seminar series, inviting experts to explore the potential of generative AI. The aim is to combine human and machine intelligence for maximum impact, with a focus on responsible AI in clinical settings. Teladoc is striving to determine how to leverage generative AI safely and effectively in healthcare, considering factors like evidence-based medicine and accuracy levels for patient support.
Teladoc Stock Forecast: 12-Month Price Target
|Average Price Target||$29.7|
|Stephens & Co||$28|
Teladoc Stock Forecast Today
|1. Market's Wisdom||Partially Bearish|
|1a. Market Data||Partially Bearish|
|1b. Technical Recommendation||Neutral|
|2. Crowd's Wisdom||Neutral|
|2a. Social Media Buzz||Steady|
|2b. Social Media Sentiment||Steady|
Teladoc TDOC Stock Forecast: Q1 results
- Teladoc Health reported Q1 2023 revenue of $629.2 million, an 11% increase YoY from $565.4 million in Q1 2022.
- Access fees revenue rose 12% to $550.9 million, while other revenue increased by 6% to $78.4 million.
- Revenue from US operations grew by 10% to $541.7 million, while international revenues increased by 18% to $87.6 million.
- The Integrated Care segment saw a 5% revenue increase to $350 million, while the BetterHelp segment experienced a 21% revenue increase to $279.3 million.
- The company reported a GAAP gross margin of 67.8% for Q1 2023, compared to 66.0% for Q1 2022. The adjusted gross margin was 69.8% for Q1 2023, up from 66.9% for Q1 2022.
- The adjusted EBITDA for Q1 2023 was $52.8 million, a 3% decrease from Q1 2022’s $54.5 million.
- The company had a net loss of $69.2 million, or $0.42 per share, compared to a net loss of $6,674.5 million, or $41.58 per share in Q1 2022. The net loss in Q1 2022 was primarily due to a non-cash goodwill impairment charge of $6,600.0 million.
- Net cash provided by operating activities in Q1 2023 was $13.2 million, compared to net cash used of $31.7 million in Q1 2022. Free cash flow was a net outflow of $32.5 million in Q1 2023, compared to a net outflow of $62.6 million in Q1 2022.
- For Q2 2023, Teladoc Health expects revenue to range from $635 – $660 million, adjusted EBITDA to be $60 – $68 million, and a net loss per share between ($0.55) – ($0.45).
- For the full year 2023, the company expects revenue to be $2,575 – $2,675 million, adjusted EBITDA to be $285 – $325 million, and a net loss per share between ($1.70) – ($1.25).
Teladoc TDOC Stock Forecast: Q2 results
- Revenue: $646.7 million, up 9.6% year-over-year.
- Earnings per share (EPS): -$0.41, narrower than the loss of $0.42 per share expected by analysts.
- EBITDA: $52.3 million, down 13.4% year-over-year.
- YOY growth: Revenue growth was driven by a 10.2% increase in access fees and a 3.4% increase in visit fees. EPS was narrower than expected due to higher operating expenses. EBITDA was down due to increased investments in growth initiatives.
- Other financials:
- Gross margin was 65.6%, down 0.6 percentage points year-over-year.
- Operating margin was -16.6%, wider than the margin of -10.5% in the same quarter last year.
- Net margin was -6.3%, wider than the margin of -3.5% in the same quarter last year.
Overall, Teladoc’s Q2 2023 financial results were mixed. Revenue growth was solid, but EPS was narrower than expected due to higher operating expenses. EBITDA was down due to increased investments in growth initiatives. Investors will be looking for the company to provide more details on its growth plans and financial outlook in the upcoming earnings call.
Teladoc Stock Performance in the Last 12 Months
- Last 1 Month: +13.9%
- Last 6 Months: -17.7%
- Last 12 Months: -31.5%
Teladoc TDOC Stock Forecast: Fundamentals
- Dwindling growth rate: TDOC management said in their earnings call, “The challenging macro environment is likely to persist. This is particularly the case with ongoing economic uncertainty as well as a moderation in overall market growth rates. Given the current operating environment as well as the larger scale at which we now operate, you should expect us to balance growth and margin with an increased focus on efficiency going forward.” This indicates that they will try to balance low growth potential with high profitability.
- Loads of cash: TDOC possesses nearly $920 million in cash with another $550 million expected to come when Livongo notes mature which is 2 years from now. So, including a probable $250 million in free cash flow expected to come over the next two years, it is possible that these notes will be converted into shares.
- Return on Investment: The company is currently operating at a negative 1.97% ROI which when compared to the industry average of 7.49% demonstrates that the company’s balance sheet and operations are far from fiscally healthy.
Teladoc TDOC Stock Forecast: Macros
The healthcare sector is going through a paradigm shift in the post covid era. The ever-increasing use of technology in all sectors including health care has been witnessed lately. Moreover, there has been a transformation from an emphasis on quantity to quality. For instance, earlier doctors were paid according to the number of tests they perform, the number of patients they treat, and other fee-based incentives. But now the healthcare sector will be valued based and they will be paid according to favorable patient treatments, thereby increasing the quality of treatments given to patients overall.
The number of collaborations is also on the rise. Instead of opening their own healthcare centers, doctors of late are preferring working in hospitals instead. This centralization of health care has helped in increasing the quality of service offered. In a nutshell, the sector is witnessing a favorable shift from focusing on the bottom line to focusing on patients.
TDOC stock forecast: Bear Case
- Disastrous Livongo Acquisition- Teladoc Health acquired Livongo Health- which specialized in chronic care management in 2020 for $18.5 billion. But the fortunes of Livongo changed after its acquisition. The company which was doing so well before the acquisition could not add value to Teladoc Health and in fact, chronic care membership had slowed down to such levels that Teladoc had to pay $6.6 billion goodwill impairment charges in this quarter related to the Livongo acquisition. Goodwill is the amount that a company pays for a particular asset beyond its real value and recent impairment charges paid signal that Teladoc paid way too much for Livongo and it is not worthy enough. Recent impairment charges have led to a 50% decrease in Teladoc’s goodwill. All this shows that the Livongo acquisition was a disastrous one.
- BetterHelp Not Performing Well –Another headwind for Teladoc is that its star product BetterHelp- its mental health segment is not performing well for a year now. In this space, the company is losing market share to well-funded competitors that keep flocking to the market, for example, Talkspace (TALK) is another competitor for BetterHelp eating up its market share. Also, management cited low rewards for marketing campaigns for BetterHelp and increased costs leading to a decrease in the revenue guidance for coming quarters.
- Management is not up to the Mark – It is true that the acquisition of Livongo Health has gone poorly for Teladoc and also its lowered guidance helped the investors to press the sell button. But there is a larger picture as to why Teladoc is performing poorly and that has to do with the approach of management. It has been the case that management has been telling one thing to investors and results are depicting something else. They are not able to deliver what they promise investors. This makes it difficult to trust the management.
TDOC Stock Forecast: Bull Case
- Possibility of a turnaround after a 90% fall – Teladoc is down by 76% in the last year (as of 14.05.2022) and is down by almost 90% from its all-time high of $154. The optimism is due to comments by Ark Invest CEO Cathie Wood who even compared Teladoc with Amazon’s decline and said that both the stocks belong to the “same league”. Noticeably, Wood’s ETF owns nearly 11% of Teladoc and it was an attempt to stabilize the share price. Also, the stock is looking cheap right now and is trading at only 2.1 times the forward sales estimate with a possibility of a turnaround anytime soon.
- Bright spots from recent quarter results- Let’s dissect the recent quarter results and find out the bright spots from the same. The fuzz is all about goodwill impairment charges and lowered guidance. But keeping that aside, results do match the expectations.
TDOC stock forecast: Conclusion
Teladoc is the leader in its space and it has been growing at a very good pace of 20% quarterly and annually. It can be argued that management has lowered guidance, but it is always good to project less and perform better, it may happen that in the next quarter’s results, it beats estimates handsomely and the share price goes up by 40% on the eve of results.
That said, it is also true that Teladoc is facing its own share of problems and it messed up the acquisition of Livongo and has lowered guidance for the fiscal year in a panic. Also, BetterHelp needs to deliver to enable Teladoc to come out of the woods. Livongo features are still not fully integrated with the Teladoc app and it can be a winner in the coming years if used properly.
Investment in Teladoc at this juncture depends on the risk appetite of investors. While it presents a golden opportunity to have multi-bagger returns in a couple of years, it is a risky bet and there are more hurdles ahead for management to come back on track.
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