'Telehealth' Is Coming To The Mainstream In A Pure-Play Package

  • Teladoc Inc TDOC shares are down 22 percent over the past month, declining steadily since August 10.
  • Leerink Partners’ Steven Wardell initiated coverage of the company with an Outperform rating and a price target of $35.
  • Telehealth has made an entry into the mainstream, Wardell said, citing the reasons as healthcare cost inflation, provider shortages, and healthcare consumerism.

Analyst Steven Wardell said there was a shortage of physicians in the US. Due to this shortage, 62 million Americans had no or inadequate access to primary care, according to the National Association of Community Health Centers. “Telehealth can help address this shortage by making physicians more accessible and filling up their schedules more efficiently,” Wardell wrote.

Employers aiming to control costs are favoring Telehealth. Healthcare benefit costs are growing at a rate faster than inflation and continue to be a major concern area for employers.

Earlier this month, CVS Health Corp CVS [rated Outperform] announced its plans to partner with Teladoc to offer a wider range of telehealth solutions to customers. “We believe this will generate new consumer demand for telehealth services and feed Teladoc additional volume over time,” Wardell commented.

Leerink Partners estimates the addressable market at over $17 billion for the ambulatory domain alone. Citing Teladoc as “one of the fastest growers in our Digital Health universe,” the analyst said that the company is poised for 60 percent top-line CAGR over the next three years.

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
date
ticker
name
Price Target
Upside/Downside
Recommendation
Firm
Posted In: Analyst ColorBiotechLong IdeasHealth CareInitiationTop StoriesAnalyst RatingsTrading IdeasGeneralLeerink PartnersSteven Wardell
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!