Analyst Richard Close of Canaccord Genuity maintained a Buy rating on Teladoc (TDOC – Research Report), with a price target of $14.00.
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Richard Close’s rating is based on Teladoc’s strategic acquisition of Catapult Health, a provider of virtual preventative care services. The integration of Catapult’s VirtualCheckup service is expected to enhance Teladoc’s chronic care programs by driving enrollment and offering significant cross-selling opportunities within its existing member base. By incorporating Catapult’s offerings, Teladoc aims to improve member engagement and experience, which could lead to higher client retention rates, especially given Catapult’s impressive NPS score of over 81.
Furthermore, the acquisition aligns with Teladoc’s objective to provide comprehensive care by connecting with third-party services, thus reducing care silos and improving overall health outcomes. The financial terms of the deal, valuing Catapult Health at $65 million with a contingent earnout, also suggest a favorable revenue growth potential for Teladoc. Overall, the acquisition is viewed as a strategic move to unlock more value and enhance Teladoc’s market position, thereby justifying the Buy rating.
In another report released on January 24, Oppenheimer also maintained a Buy rating on the stock with a $12.00 price target.
TDOC’s price has also changed dramatically for the past six months – from $7.600 to $11.000, which is a 44.74% increase.