Stephens Initiates Teladoc Health Coverage With Equal-Weight, Sees Balanced Risk-Reward Profile

Stephens analyst Jeff Garro initiated Teladoc Health Inc TDOC coverage with an Equal-Weight rating and a price target of $25.
The analyst believes TDOC is well positioned to be the bellwether digital health company due to its unique assets and scale; he provides numbers confirming TDOC as a clear virtual care leader: 80M+members, 30K+ providers, 60+ NPS, 20M+ annual visits.
Garro adds that while the company has a strong product portfolio and a large customer base, it hasn't been able to meet lofty cross-sell expectations.
The analyst states that TDOC's positioning is compelling, but gradual member adoption of virtual-first holistic care creates a lag from pipeline to financial impact.
Garro thinks that BetterHelp is an incredible success story, but in the short term, it is likely that it can only grow moderately while still delivering margin expansion.
TDOC is still growing and innovating, even at a more mature stage. The analyst expects investment in LT growth to limit margin expansion.
Price Action: TDOC shares are trading lower by 1.60% at $25.85 on the last check Wednesday.

Analyst Calendar