What happened
Shares of Teladoc Health (TDOC +2.35%) were falling 3% as of 11:45 a.m. EDT on Wednesday. There isn't any specific news from the company, but the move lower mirrors that of some of the biggest beneficiaries of the pandemic.
So what
With COVID cases and death rates in the U.S. at the lowest levels since the early days of the pandemic, investors could be reacting to the prospect that the health emergency is winding down. That could be shortsighted.
Image source: Getty Images.
Although a late-June uptick in cases appears to have reversed nationally, case reporting over the holiday weekend showed half of the states had meaningful increases in the past week. Some of the states with the lowest vaccination rates have seen cases double in the past week and a rise in hospitalizations.
The country narrowly missed a goal to get at least one dose to 70% of the population by Independence Day. Despite the overall miss, the state-by-state story is drastically different. States like Massachusetts and Connecticut have more than 6 in 10 residents fully vaccinated while Southern states like Georgia, Louisiana, Tennessee, and South Carolina are well below 40%. Over time, that's likely to exacerbate the geographic disparity in cases, hospitalizations, and deaths.
Now what
The combination of the the fast-spreading Delta variant and low vaccination rates should keep tools like Teladoc's virtual-visit platform in high demand. Investors will get insight into how well business is holding up when the company reports earnings in early August.
The company typically shares utilization rates -- the percent of members who had a virtual visit -- in its earnings calls. That number rose from 13.4% in the first quarter of 2020 to 19.6% a year later. If it remained elevated during the second quarter, it could indicate that behavioral shifts from the past year will remain in place longer than many on Wall Street are anticipating.
