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Is Teladoc Stock a Buy Near Its 52-Week Low?

By Keith Speights and Brian Orelli, PhD – Updated Jan 3, 2022 at 9:41AM

Key Points

  • Teladoc stock has fallen in large part because of valuation concerns.
  • The virtual-care market opportunity, though, is huge.
  • Teladoc is well positioned to dominate in this market over the long term.

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If you're a long-term investor, the answer seems to be a resounding yes.

Teladoc Health (TDOC 6.02%) disappointed investors in 2021 with its shares plunging more than 50%. In this Motley Fool Live video recorded on Dec. 15, 2021, Motley Fool contributors Keith Speights and Brian Orelli answer a viewer's question about whether or not Teladoc stock is a buy near its 52-week low.

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Keith Speights: Bulgarian Fool says, "Hey guys, if time permits, could you possibly share your opinions on Teladoc?" The ticker there is T-D-O-C. "The stock price is on a 52-week low." Brian, I certainly have my opinions on Teladoc. I'll let you weigh in first.

Brian Orelli: I don't follow Teladoc that closely, but certainly I think that the pandemic caused the stock to maybe get ahead of itself in the valuation, and that's the reason why it's slipped this year. That would be my take on why it's at a 52-week low.

I know you follow it and I think you're probably a shareholder. Any thoughts?

Keith Speights: I am. And I just looked: The stock's market cap currently is a little over $14 billion. I think Teladoc is worth a lot more than that over the long run.

I think some of the sell-off this year was warranted. I do think Teladoc got a little too frothy there. But on the other hand, I think the downturn has been overdone as well.

Look, I think that the opportunities for virtual care, including telehealth, including digital health management of chronic diseases, I think that's a massive market over the long run, not just in the U.S., but worldwide. I think there's no other player that's positioned as strongly to dominate in that market as Teladoc Health is.

So I do not think by any means that this company is only going to be worth $14 billion or so in five years from now. It's going to be a lot bigger.

I do own shares, and I've watched this stock go down and I've never been tempted to sell. I'm convinced that the long-term prospects are really good for Teladoc and for virtual care in general. I think there are going to be multiple players that can win in this market.

This is one of those cases where if you look at the short term, things might look bleak. But just back up, look at the long term prospects, and I think you will emerge with a much better opinion of Teladoc Health.

Brian Orelli, PhD has no position in any of the stocks mentioned. Keith Speights owns Teladoc Health. The Motley Fool owns and recommends Teladoc Health. The Motley Fool has a disclosure policy.

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