A Triple-Digit Price Target Is Realistic for Teladoc Health Stock

  • Teladoc Health (TDOC) stock is trading at pre-Covid-19 levels now.
  • At least two Wall Street analysts have set high price targets for the stock.
  • Investors should consider buying a few shares prior to Teladoc’s upcoming earnings release.
The Teladoc (TDOC) logo through a magnifying glass.

Source: Postmodern Studio / Shutterstock.com

New York-headquartered telemedicine specialist Teladoc Health (NYSE:TDOC) has scheduled its next quarterly financial data report to be released on Apr. 27. It is a good idea to purchase TDOC stock prior to that day, as Teladoc is undervalued and deserves to move much higher.

The onset of the Covid-19 pandemic wreaked havoc on many businesses, but it shone a spotlight on the telehealth market. Consequently, Teladoc became a darling of the markets for a while.

However, TDOC stock has gone from growth stock to distressed asset over the past year. Perhaps some traders feel that Teladoc’s business is bound to decline as the Covid-19-related catalysts of 2020 aren’t as prevalent in 2022.

Yet, as Teladoc’s next earnings event approaches, informed investors should be skeptical of the skeptics. Previous results indicate that Teladoc is still capable of outstanding revenue growth. Besides, a couple of Wall Street experts are bracing for a major share-price comeback.

TDOC Teledoc Health, Inc. $63.16

What’s Happening with TDOC Stock?

Truly, it’s amazing to consider that TDOC stock is trading at late 2019 prices. Does the market really feel that the telemedicine market, and Teladoc Health in particular, hasn’t progressed since the onset of Covid-19?

Granted, the stock price did go too far too fast last year. At one point, the Teladoc share price hit an eye-popping $193.51 as the stock went vertical. More recently, TDOC stock traded fairly close to the $65 level. Sometimes, hype-fueled rallies can lead to over-corrections and this appears to be a prime example.

After all, we’re not talking about a stagnating business here. During the fourth quarter of 2021, Teladoc grew its revenue 45% year-over-year to $554.2 million. In that same time frame, the company’s total visits increased 41% to 4.4 million.

It only gets better when we expand our look-back period to full-year 2021. During that time, Teladoc’s revenue expanded 86% year-over-year to $2.03 billion, while the company’s total visits increased 38% to 15.4 million.

Looking ahead, Teladoc anticipates full-year 2022 revenue in the range of $2.55 billion to $2.65 billion, which would represent 25% to 30% year-over-year growth. There is no guarantee that the company’s upcoming earnings release will be positive, but the signs point to fast growth for Teladoc.

$96, or Even $120

Traders might not be buying TDOC stock hand over fist right now, but at least two prominent Wall Street experts seem to be leaning bullish. Take Guggenheim Partners analyst Sandy Draper, for example. Draper issued a “buy” rating on Teladoc along with $96 price target for the shares. That is not quite triple-digits, but still pretty ambitious. Evidently, Draper views Teladoc as solidly positioned in a future-facing telehealth market. He wrote:

“We think healthcare access is moving more toward digital interactions, and TDOC’s broad suite of services addresses more touch points than any other provider, in our view.”

Draper further observed that Teladoc is both EBITDA and cash-flow profitable. That is something we can’t say about every telemedicine business.

Meanwhile, RBC Capital analyst Sean Dodge maintained an “outperform” rating on TDOC stock. Dodge also issued a $120 price target for Teladoc shares. Granted, Dodge cut that price target down from $215. Still, Teladoc’s shareholders probably wouldn’t mind too much if the stock “only” went to $120.

According to TheFly, Dodge’s analysis of BetterHelp’s digital traffic data “points to activity growing over 35% during the quarter.” This may have prompted the analyst to lean bullish on digital healthcare and on Teladoc Health.

What You Can Do Now

Please understand, TDOC stock isn’t likely to move to $96 or $120 overnight. Even an outstanding earnings report probably wouldn’t accomplish that. Still, the aforementioned analysts seem to anticipate strong upside for the stock. It could just be a matter of time before Teladoc’s shareholders enjoy a major windfall.

The more cautious move would be to wait until the upcoming earnings report has passed. Then you can make a decision on TDOC stock.

If you don’t mind taking on some risk, however, then you can buy some shares prior to the earnings release. Teladoc’s revenue growth should persist for a long time, benefiting the company and its stakeholders.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.


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