Teladoc Health Benefits From Johnson & Johnson's Problems!

and, "Weekly Options Members” Make 249% Potential Profit In 24 Hours!
More to Come?

April 14, 2021

Teladoc Health stock rose Tuesday as The Food and Drug Administration moved to temporarily halt the rollout of Johnson & Johnson's COVID-19 vaccine.

And, “Weekly Options Members” managed to gain a potential profit of 249% in 24 hours.

More upwards movement is expected, and for those that have exited the trade, a new trade may be considered.

Why The Trade Recommendation On Teladoc Health?

The stock market had an unprecedented year in 2020, putting up better-than-average gains while facing down a global pandemic. The S&P 500 added more than 16% last year, but the tech-heavy NASDAQ was the big winner, soaring nearly 44%. Some of the biggest technological trends came clearly into focus last year, as streaming video, cloud computing, and telemedicine gained legions of converts.

So far this year, however, investors have been buying stocks that they believed would benefit from the recovery, rotating out of many tech stocks in the process. This has left plenty of bargains among these high-growth stocks in categories that combine best-in-class products and services, huge tailwinds, and large addressable markets.

The future of medicine came into focus last year with the accelerated adoption of virtual care, telemedicine, and connected healthcare devices. The demand for app-based doctor visits soared. That put industry-leading provider Teladoc Health in the pole position. Now that an end to the pandemic is in sight, some investors believe the vast majority of patients will forego the ease and convenience of digital appointments in favor of a return to in-person visits. The evidence simply doesn't support that view.

Teladoc shares soared last year, gaining 139%.

The Major Catalysts for This Trade.....

1. Virtual Care.....

Patients are embracing virtual care, and recent studies suggest that the majority will continue to do so. A survey of 2,700 patients revealed that 90% found the quality of care received during app-based video visits with their physician was as good, if not better than regular office visits, according to research conducted by Accenture. Some 60% of respondents said they planned to use telehealth solutions with even greater frequency in the future to communicate with their healthcare providers and manage chronic conditions.

It's considerably more convenient for patients and allows physicians to better keep tabs on potentially high-risk patients. Virtual visits are also billed at a lower rate than office visits, which makes telehealth an instant hit with health insurance companies.

2. Results.....

Teladoc's results paint a compelling picture. Revenue grew 98% in 2020, while total patient visits surged 206%. While the bottom-line results were muddled by acquisition-related costs and income tax complications, the company's adjusted EBITDA increased 298%.

, the company says its revenue will increase at least 78% in 2021 to $1.95 billion and its adjusted EBITDA will at least double to $255 million. That values Teladoc shares at about 14 times expected 2021 sales -- not bad for a high-growth name in the health tech space.

3. Livongo Health.....

The recent acquisition of Livongo Health puts Teladoc at the forefront of another booming trend: the use of connected devices to manage chronic conditions. With more than 147 million patients with at least one chronic condition, dealing with them regularly can be time-consuming and expensive. By providing timely reminders and hints via connected devices and apps, patients enjoy an improved quality of life. The process also reduces the cost of healthcare, which benefits insurers, creating a true win-win.

The combined addressable market of Teladoc and Livongo tops out at more than $64 billion. When taken in the context of the $1.09 billion in revenue Teladoc delivered in 2020, it illustrates the long runway for growth ahead.

The Pullback Provides Opportunity.....

Teladoc has lost close to 40% of its value in less than two months, primarily as a result of the U.S. successfully administering over 167 million coronavirus vaccines as of April 5. With nearly a quarter of the adult population fully vaccinated, and Amazon announcing a nationwide expansion of its virtual-care platform, there's been some concern about where Teladoc goes from here.

Analysts Positivity.....

However, Wall Street says it will go up. With a consensus price target of almost $260, Teladoc offers implied upside of 43% over the next year.

Piper Sandler analyst wrote that he would be a buyer of the stock “on recent weakness.”

Summary.....

Virtual care remains only in its early innings. Consulting firm McKinsey predicts that the U.S. virtual-care market could reach $250 billion per year after the pandemic is over. Teladoc's opportunities aren't just limited to the U.S., either.

Teladoc's head start, commanding market presence (its customers currently include over 40% of the Fortune 500), and scope of products and services give the company solid competitive advantages.