Teladoc Health, Inc.

Teladoc Health, Inc. (NYSE: TDOC) operates in the health services industry and offers virtual healthcare. With a portfolio of services and solutions, the company provides virtual access to care for various medical subspecialties, ranging from non-urgent, episodic needs like the flu and upper respiratory infections to chronic, complicated medical conditions like hypertension, cancer, and congestive heart failure. It provides virtual healthcare services to its clients, including employers, health plans, hospitals and health systems, and insurance and financial services companies, on a business-to-business (B2B) basis, spanning the global healthcare landscape. It also provides services to consumers directly and through channel partners.

Key Highlights

• The company reported YoY growth of 24.62% in revenue to USD 565.35 million in Q1FY22 (ended March 31, 2022) compared to USD 453.68 million in Q1FY21 However, TDOC reported net loss expanded to USD 6.67 Billion in Q1FY22 from USD 199.65 million in Q1FY21.
• In early trading session as of April 28, 2022, TDOC shares lost almost 50% of its market cap, implies one of steepest sell-off since company went public in 2015. As, despite ~25% surge in topline on YoY basis reported by the company in Q1FY22, losses expanded significantly.
• As of March 31, 2022, the company had cash and cash equivalents (including short-term investments) of USD 838.99 million and total debt of USD 1.55 billion.
• TDOC’s ROE for Q1FY22 was -53.0%, significantly lower than the industry median of -0.8%.
• Stock is currently below between its crucial short-term (50-day) and long-term (200-day) SMA support levels, a bearish indicator. Further, the stock has tested a new 52W low on April 28, 2022, implies Bears are getting strong grip over the stock.

Conclusion: Shares of Teladoc Health fell hard (40.15%) after U.S. stock markets closed on Wednesday in response to a dismal first-quarter earnings call. The company was able to report total revenue that soared 25% year over year, but it seems that Investors had been looking for a bigger payoff as the pandemic drove a pickup in virtual doctor visits, but increased competition, including from insurers, has cut into telemedicine profits and the market is responding to signs of trouble that aren't apparent until you look past the headline numbers. We recommend a "Watch" rating on the stock at the closing price of USD 33.51, down 40.15%, as of April 28, 2022, and we will further reevaluate the stock in next  couple pf week

Technical Price Chart (April 28, 2022). Source: REFINITIV, Analysis by Kalkine Group

Technical Analysis Summary:

*Closing price as of April 28, 2022

Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

Note 1: The reference data in this report has been partly sourced from REFINITIV.  

Note 2: Investment decision should be made depending on the investors' appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the valuation has been achieved and subject to the factors discussed above. 

Note 3: The report publishing date is as per the Pacific Time Zone.

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