Teladoc Continues To Execute And Is Still A Strong Buy

Aug. 03, 2019 10:04 AM ETTeladoc Health, Inc. (TDOC)11 Comments
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Freyr Capital


  • Teladoc reported yet another quarter of solid results.
  • The report included busy pipeline, increased utilization, and solid growth. We view the results as an indication of Teladoc's market potential and its leadership.
  • We still continue to see value in the name and strongly recommend investors buy Teladoc.


We're writing here to follow up on our previous article on Teladoc (NYSE:TDOC). In this article, we will assess the company's most recent quarterly report and its earnings call, as well as provide insight on where we think the company is heading. For convenience, we're including our Investment Thesis from our previous article.

Investment Thesis

Teladoc Health stands to benefit from the ongoing shift in healthcare to telemedicine and has a massive untapped addressable market. The company provides widely accessible care at affordable prices, targeting to solve the main challenges facing US healthcare. Its scalable platform based model is favorable to investors due to high gross margins and subscription-based revenues. We believe that now is a great time to buy as the valuation is attractive due to transitory issues. We see earnings and announcement of new clients as potential short-term catalysts. We recommend investors buy and hold for the long term, adding on dips.

The Financials

The results were, as is usually the case with Teladoc, solid. It performed well across the board and raised guidance and highlighted solid membership trends.

Teladoc reported $130.3 million in revenues which represented an impressive 38% YoY growth and just beat consensus estimates of $129.6 million. This was at the high end of the management guidance range of $128 million to $131 million.

All the underlying revenue related metrics seemed good. Organic revenues grew solidly at 24% YoY. Access fees grew at 39% YoY, reaching $111 million or 85% of total revenues. Total visits came in at 908k, well above the guided range of 775k-875k. U.S. paid member visits came in at 610k, representing a 40% YoY growth.

Number of members were the only blemishes on the quarter, albeit minor ones. U.S. paid members came in at 26.8 million which was 19% than a year ago, just

This article was written by

Freyr Capital profile picture
We're a group of 6 combining hedge fund, management consulting, and audit experience. Usually we conduct equity focused strategic research on companies we invest in. We make tactical commentary from time to time.

Disclosure: I am/we are long TDOC. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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