Teladoc Health: Not Turning The Corner Yet
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Update - July 28
The large amount of analyst downgrades possibly created the bottom in $TDOC today. The stock was clearly far more attractive near the lows at $133 with a retest of the prior lows. The stock still isn't cheap at $150.
-Teladoc (NYSE:TDOC) has extended its post-market losses with a decline of ~9.2% in early trading after the company drew lower price targets and a downgrade following its Q2 2021 financials on Tuesday.
-Noting that its utilization growth could be hard to replicate the expansion seen in 2020/21, Deutsche Bank analyst George Hill has cut the recommendation on Teladoc to hold from buy. The revised price target of $153 implies a premium of ~1.3% to the last close.
-“We believe Teladoc has a very good business led by a very strong management team, but that does not make TDOC a good stock,” Hill wrote estimating a 12x EV/Sales multiple for 2021 down from 15x previously to reflect among other things the changing competitive environment.
-Meanwhile, Evercore ISI analyst Elizabeth Anderson (in-line) has slashed the price target for Teladoc to $150 from $170, noting the focus on how 2022 unfolds given the “robust competitive environment, and despite the recent membership growth trajectory.”
-Stifel analyst David Grossman points out that “unanswered questions persist,” as the firm with a hold rating on Teladoc trims the price target to $165 from $195.
Update - July 27
Down 7% b/c $TDOC isn't the growth story people expected.
-Q2 GAAP EPS of -$0.86 misses by $0.32.
-Revenue of $503M (+108.7% Y/Y) beats by $3.15M.
-Adjusted Gross margin was 68.1%
-EBITDA was a loss of $27.6M
Outlook Q3 2021
-Total revenue to be in the range of $510 million to $520 million.
-Adjusted EBITDA to be in the range of $60 million to $65 million.
-Net loss per share, based on 159.8 million weighted average shares outstanding, to be between $(0.78) and $(0.68).
-Total U.S. paid membership to be in the range of 52 million to 53 million members and visit fee only access to be available to approximately 22 million individuals.
-Total visits to be between 3.4 million and 3.6 million.