One of the pandemic darlings, telemedicine platform Teladoc Health (TDOC) has been languishing at multi-year lows, unable to retain or regain its stellar momentum during 2020 and 2021, explains Todd Shaver, growth expert and editor of Bull Market Report.

While the COVID-driven growth was always unsustainable, the reach and traction it gained in diversified healthcare during the past two years will help it scale higher as it enters a period of secular, broad based, and a more normalized pace of growth.

Teladoc released its third quarter figures a month ago, reporting $610 million in revenues, up 17% YoY, compared to $520 million a year ago. The company posted a loss of $74 million, or $0.45 per share, compared to a loss of $84 million, or $0.53, with strong top and bottom line beats, resulting in a stunning reversal in the stock.

On the operations front, the firm saw 4.6 million total visits, up 14% from 4.0 million a year ago. Paid members within the US closed in on 58 million, up 10% from 53 million a year ago, followed by visit fee-only access at 24.3 million, up 3% from a year ago. The number of members enrolled in its suite of chronic care programs hit 800,000, up from 725,000.

The company continues to gain share in an increasingly fragmented marketplace, as the higher cost of capital and souring macro sentiments squeezes some of its smaller competitors, and newer entrants in this segment. Teladoc’s robust deal pipeline with employers, and its suite of integrated offerings help create a sturdy fortress even against well capitalized competitors within the segment.

With the stock trading at a valuation which is a little under two times sales, and a strong YoY margin growth, it stands to add substantial value for shareholders in the years ahead.

This marks the perfect point of entry, especially as the stock remains effectively de-risked, and maintains a user base with plenty of value to be unlocked. With $900 million in cash, $1.6 billion in debt, and $206 million in cash flow, we expect good things going forward.

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