With the stock market southbound since the beginning of the year, it's not difficult to find companies that have lost a great deal of value in the past five months. However, some stocks have been struggling for much longer.

That's the case for healthcare company Teladoc Health (TDOC -1.54%), whose shares are down nearly 77% over the past 12 months. But if the telehealth specialist can stage a comeback, those who scoop up its shares today will be glad they did so. Let's consider why Teladoc is worth buying at current levels.

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Teladoc's latest financial results

Teladoc had a lot to prove going into its latest quarterly update in late April. Unfortunately for the company, its results did not live up to expectations. The biggest issue investors had with Teladoc's financial results was the massive quarterly net loss per share of $41.58, although that was almost exclusively due to a one-time charge (more on that below). For comparison, the company's net loss per share during the first quarter of 2021 was $1.31.

It is difficult enough for corporations that aren't consistently profitable to impress investors in these challenging times. Teladoc's loss per share worsening substantially compared to the year-ago period did not please anyone. Further, the healthcare company lowered its guidance for the year. Instead of revenue between $2.55 billion and $2.65 billion, Teladoc now expects revenue between $2.4 billion and $2.5 billion.

Parent with a young child on a telemedicine call with a physician.

Image source: Getty Images.

These issues can't be ignored, but it's essential to put them in context. Teladoc's massive net loss was almost entirely due to a $6.6 billion goodwill impairment charge related to its 2020 acquisition of Livongo Health. Goodwill shows up on a company's balance sheet as the premium it paid after an acquisition, and impairment charges are used to write off goodwill. In other words, Teladoc overpaid for its acquisition of Livongo Health.

On a more positive note, we are unlikely to see more impairment charges of that size related to this transaction on Teladoc's financial statements. Meanwhile, the lower guidance was due to unfavorable dynamics in the market for mental health services, where the company is not seeing the return on marketing investment it expected to see.

Teladoc thinks this is primarily a result of smaller competitors implementing aggressive strategies to attract clients, strategies which the company believes are unlikely to be successful in the long run. While Teladoc thinks these dynamics will present challenges for the remainder of the year, the company is still well positioned for long-term growth in the behavioral health space thanks to the wider scale at which it operates, which allows it to put money back into the business to drive growth without sacrificing margins.

It wasn't all bad for Teladoc in the quarter. During the first quarter, the company's revenue increased by 25% year over year to $565.4 million. Teladoc's total visits grew by 35% year over year to 4.5 million, while average U.S. revenue per member came in at $2.52, 21% higher than the year-ago period. U.S. paid membership climbed 5% year over year.

Why the long-term view remains attractive

Some of the headwinds Teladoc has encountered (and continues to face) are temporary. The company won't report massive impairment charges every quarter, for instance. And while it is dealing with increased competition in the direct-to-consumer mental health market, its business is much broader than that. Last year, the company's revenue in mental health accounted for about 28% of its total revenue.

One important reason to remain optimistic about Teladoc's future is that the telemedicine industry likely has a long runway for growth. According to some estimates, this space will expand at a compound annual growth rate of 15.8% through 2027. It likely won't stop there.

Telehealth offers numerous benefits to patients. Getting some medical attention (consultations, prescriptions, and referrals) from the comfort of one's home at any hour of the day beats having to get to an office to receive the same service. Further, the evidence suggests it helps patients save money. One study found that each telemedicine visit saves patients between $19 and $121.

Teladoc is one of the leaders in telemedicine. And thanks to the solid network of patients and physicians it has already built -- not to mention its brand recognition -- it is likely to remain near the top of the industry. What's more, Teladoc stock is currently trading well below pre-pandemic levels.

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TDOC data by YCharts

That's despite the fact that the company's revenue, total visits, and average U.S. revenue per member have all grown substantially since late 2019. At current levels, Teladoc looks like a steal. Even if the healthcare company continues to face headwinds in the near term, it is well positioned to turn things around in the long term. That's why I am holding on to my Teladoc shares, and don't intend to sell them anytime soon.