Please ensure Javascript is enabled for purposes of website accessibility

Why Teladoc Stock Dropped Today

By Joe Tenebruso - Feb 23, 2021 at 8:15PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Traders are moving on from the telehealth leader's shares. But should they be?

What happened

Shares of Teladoc Health (TDOC -4.88%) fell 4.8% on Tuesday, as investors sold so-called stay-at-home stocks.

So what 

With new COVID-19 case counts declining, people have begun to look ahead to an eventual end to the coronavirus pandemic. Many investors, in turn, have rotated out of companies that have performed well during the COVID-19 crisis and into stocks that could outperform as the economy recovers.

A digital stock chart with falling prices.

Image source: Getty Images.

Teladoc has seen its growth accelerate during the pandemic. The virtual healthcare leader's revenue soared 109% year over year to $288.8 million in the third quarter, fueled by a 206% surge in member visits. Yet many investors are now questioning whether Teladoc will continue to deliver such impressive growth when it becomes safe for people to see their doctors in person once again. 

Now what

Teladoc's skeptics, however, are overlooking one thing: Telehealth is here to stay, and it's set to grow even more popular in the years ahead. Virtual care consultations are convenient for patients and cost-effective for healthcare providers. Due partly to these reasons, telemedicine will become a $175 billion market by 2026, according to Global Market Insights. Few companies are poised to benefit from the growth of virtual care more than Teladoc.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Teladoc Health, Inc. Stock Quote
Teladoc Health, Inc.
$31.95 (-4.88%) $-1.64

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/16/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.