What happened
Shares of telemedicine company Teladoc Health (TDOC -1.52%) rose 15.77% on Thursday. The stock closed on Wednesday at $26.76 and opened on Thursday at $29.13. It climbed as high as $30.99 in the late afternoon before ending the day at $30.98. The stock is still down more than 66% so far this year and is a lot closer to its 52-week low of $23.08 than its 52-week high of $139.49.
So what
Much of the run can be attributed to the general euphoria in the markets Thursday when inflation numbers came in lower than expected, meaning the Federal Reserve may slow down its rate of interest rate increases.
Teladoc is also up more than 26% over the past month, thanks in a big part to its encouraging third-quarter report, which it released on Oct. 26. The company reported revenue of $611.4 million, up 17% year over year, and said it had net losses of $73.5 million, or a loss in $0.45 in earnings per share (EPS), compared to a net loss of $84.3 million, or an EPS loss of $0.53, in the third quarter of 2021.
Now what
The stock was a big favorite of investors during the pandemic, but fell hard when the pandemic restrictions began to ebb. Now, it appears it is closer to finding profitability than it ever was. The stock is still a big favorite of Cathie Wood's ARK Innovation ETF and has the advantage of a well-known brand name in a growing field.
Another factor could help Teladoc. A colder-than-normal winter is forecast in the Northeast, so that would encourage more patients to avoid in-person doctor visits in favor of Teladoc appointments.
One thing that is overlooked is the long-term exposure the healthcare company got during the pandemic that is still driving revenue. The company has more members (57.8 million) than it did a year ago (52.5 million) and it made more revenue per member in the quarter, $2.61, up from the $2.41 in revenue per member it reported in the same period last year.
