Could Amazon (NASDAQ:AMZN) be about to throw its hat into the ring in the telehealth market? Recent reports indicate that it could be likely. The e-commerce giant launched telehealth services for its employees and seems to be preparing to sell the service to other employers. In this Motley Fool Live video recorded on Dec. 16, 2020, healthcare and cannabis bureau chief Corinne Cardina and Fool.com writer Keith Speights discuss whether or not Teladoc Health (NYSE:TDOC) could be in trouble if Amazon jumps into telehealth.
Corinne Cardina: Absolutely. Let's do a couple of Slido questions. First Time Fool asked, "What are your thoughts on Teladoc versus Amazon?" Those are not two that I have necessarily thought about together. What do you think?
Keith Speights: Yeah. Actually, Teladoc stock is falling today and as soon as we finish up, I've got an article to write about that stock falling.
Look, I've said for a while personally that I saw Amazon as a potential threat to Teladoc. Amazon had started its own telehealth services for its employees in certain cities. I think they started in the Seattle area and I think they were looking to expand it to other cities. When Amazon does something like that, watch out. They start small, but then they look to expand and I think that's what we'll likely see.
I haven't fully researched the story yet this morning, Corinne. But so, is Amazon as a potential rival to Teladoc Health? Absolutely. Is Teladoc Health still a strong company? Absolutely.
Teladoc has a lot of momentum. They target employers and health plans and they've done a fantastic job at doing that. They acquired Livongo Health earlier this year, which gives them a very strong digital health management platform for managing chronic diseases or helping individuals manage their own chronic diseases.
I think the value proposition is certainly still there for Teladoc Health. The market opportunity is so huge. There can be multiple big players in the market. But I certainly hope that Teladoc Health doesn't stick its head in the sand and not take the threat from Amazon seriously.
Corinne Cardina: Definitely, and there's a big difference in the sizes too, in terms of an investment, Teladoc is nowhere near the size of Amazon. Health is their main business. Amazon has to share resources with, I don't know, 10, 20 different businesses. I think if you're making an investment decision, just look at both stocks as a whole and what their potential upsize is.
Keith Speights: Right. Look at that total addressable market. It is huge and it's one, like I said, that there can be multiple successful big players in that market.