If you have $5,000 that you can afford to invest in the stock market, now may be an opportune time to do so, with the S&P 500 coming off its worst month since the start of the pandemic. Moreover, you can invest that money in just two great stocks and benefit from diversification, growth opportunities, and even dividend income.
That's what you can expect to get from investing in both Teladoc Health (TDOC 0.08%) and ExxonMobil (XOM -0.05%). One stock is at a deep discount, while the other has been soaring and might continue to do so this year.
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1. Teladoc Health
Admittedly, looking at the above chart could be frightening for a potential Teladoc investor. But long-term investors need to remember that a stock's 12-month returns could end up being just a bump in the road when looking at a much longer time frame.
And despite the recent bearishness, I still have lots of hope for Teladoc's business. The telehealth stock's price has bounced upward from a 52-week low of $66.50, and there's still much more room for it to rise. In fact, Wall Street analysts who cover the stock have $165 as the consensus price target.
The company reports its fourth-quarter and year-end earnings later this month. A positive result could lead to some much-needed bullishness for the stock, potentially sending it rallying sooner rather than later. One of the reasons I'm optimistic for an earnings beat in the fourth quarter is that when Teladoc issued its third-quarter numbers and most recent guidance on Oct. 27, 2021, that was before the emergence of the omicron COVID-19 variant. Telehealth has grown in popularity amid the pandemic. Heightened fears of going out in public, making people want to stay at home to stay safe, could lead to a surge in telehealth visits. And that will likely show up in the company's upcoming earnings report, covering the last three months of 2021.
Teladoc was forecasting revenue between $536 million and $546 million for the last quarter of the year, which at the midpoint would represent a quarter-over-quarter increase of 3.7% from the $522 million it reported in the third quarter.
And that was with COVID concerns starting to subside. That's why I would be surprised if the company isn't able to outperform the targets it set out when it released its third-quarter numbers.
Over the longer term, the stock is an even better buy. Fortune Business Insights projects the global telehealth market to be worth $636 billion by 2028, which is more than four times its value in 2020, when it totaled $144 billion.
Image source: Getty Images.
2. ExxonMobil
ExxonMobil stock has been almost a mirror image of Teladoc's, rising sharply while the healthcare stock has been struggling. And the oil and gas producer could continue to rise in value this year. Oil prices typically increase during inflation, and that's been true of late, as the commodity is now at levels not seen since 2014.
A higher price of oil means more revenue and profit for ExxonMobil. And that's just what the company delivered when it reported its most recent earnings numbers. In 2021, the company posted earnings of $23 billion, which was a complete reversal from the previous year, when Exxon incurred a loss of $22 billion -- largely due to impairment charges. And this past year, it brought in $48 billion in cash from its operating activities, which is the highest since 2012.
As long as oil prices remain as high as they are now -- which may happen if travel demand soars as countries potentially reopen this year -- Exxon could be one of the hottest buys of 2022. It trades at a forward price-to-earnings multiple of 12.4, slightly less than rival Chevron at 13.2. At 4.3%, its dividend yield is also a touch higher than the 4.2% Chevron pays, and well above the S&P 500 average of 1.3%.
Between high prices and stable recurring income from this Dividend Aristocrat, there's plenty of incentive to hold ExxonMobil stock for both the short and long term.
