Wall Street Is Wrong (Again) About This 69% Winner

The "back office" numbers support my argument that this is a perfectly positioned stock that's just getting started when it comes to lining shareholders' pockets.

Teladoc Is Posting Great Numbers in Any Environment

Despite Wall Street's mistaken belief that telemedicine is somehow a fad or passing craze of some kind, the number of "visits" using Teladoc's platform has been growing at a compound annual growth rate of over 80%.

Recurring revenue has also jumped by more than 80%. Its sales have grown at an average of 56% a year; if the company maintains half that momentum, sales will double before 2024.

And with Teladoc's client list, that's almost a certainty – more than 40% of Fortune 500 companies use Teladoc, and over 600 health systems use the firm's platform. That means that by the end of last year, Teladoc's network included over 11,000 physical care locations, for those not-infrequent times when patients need hands-on care.

Teladoc's done-deal merger with Livongo is what sparked the August sell-off, and Wall Street can't seem to shake that "hangover." Never mind that Livongo's medical devices are key to growing Teladoc's business while maintaining a high standard of care – including artificial intelligence (AI) "nudges" for patients trying to stick to a prescribed regimen of some kind.

After the merger, Teladoc reported seemingly steep losses; $18.5 billion is a lot of money. But Wall Street's thinking didn't account for the fact that most of that was stock-based, and not actual operating losses. In other words, those "losses" didn't actually involve Teladoc losing real money. Indeed, its negative earnings-per-share (EPS) figure has steadily improved over recent quarters and is expected to go positive when it reports its first-quarter 2021 earnings – analysts expect $0.59 a share.

This most recent sell-off catalyst seems to have been blocks of shares recently sold by two key insiders, both of whom still own the majority of their TDOC shares, according to SEC filings. Insiders can sell for a lot of reasons, and, for perspective, they own less than 4% of the company's shares.

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Disclosure: None.

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