Here’s why Teladoc Health stock fell 16% in February
Actions of Teladoc Health (NYSE: TDOC) fell 16.2% in February, according to data provided by S&P Global Market Intelligence. During the month, the company dazzled investors with impressive 2020 full year results. But his predictions fell short of expectations, causing most of the title’s decline.
For the full year of 2020, Teladoc’s revenue nearly doubled, up 98% to nearly $ 1.1 billion. Visits have grown again, with a 156% increase from 2019. It was certainly an exceptional year, as the pandemic pushed the uptake of the remote healthcare services provided by the company.
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But Wall Street analysts were divided over Teladoc’s management direction for 2021. Some saw future revenue growth as a reason to increase their Teladoc share price targets. Management is guided for annual revenue of $ 1.95-2 billion, good for 78-83% year-over-year growth.
However, other analysts have noted that Teladoc management does not expect paid memberships in the United States to reach a range of 52-54 million in 2021. For the outlook, Teladoc finished 2020 with 51.8 million paying members in the United States – meager growth to say the least. These analysts in fact lowered their price targets for Teladoc, causing the stock to drop for February.
I can appreciate Wall Street’s desire to see a better increase in membership for Teladoc. But for me, the company’s advice dispels a common misconception with Teladoc. Many believed he took advantage of the pandemic in 2020 but would return some of his earnings. But if management’s predictions are correct, it will hold on to its 2020 earnings.
In other words, the adoption of telehealth took a giant leap over the past year and is not expected to be backing down anytime soon. This bodes well for Teladoc’s business in the long term, although 2021 will not be as spectacular as 2020.
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