Teladoc (NYSE:TDOC) stock rose 3% after Citron Research identified the company as a long investment opportunity, highlighting the growth potential of its BetterHelp online therapy platform.
Citron Research described Teladoc as a "coiled spring," noting that despite being the world’s largest telehealth platform with a market capitalization of just $1.2 billion, it owns BetterHelp, which they identified as the leading brand in online therapy.
The research firm pointed to Teladoc’s recent acquisition of UpLift as a transformational development that could significantly boost the company’s revenue. The acquisition reportedly provides Teladoc with the infrastructure to bill insurance for BetterHelp services, potentially integrating the platform into employer plans, Medicaid, and commercial networks.
According to Citron, BetterHelp has operated as a cash-pay only service until now, which resulted in approximately 80% of potential users abandoning the service at checkout. Despite this limitation, BetterHelp still developed into a billion-dollar business.
Citron highlighted comments from Teladoc’s CEO and CFO at a recent Goldman Sachs event, where they reportedly stated that a mere 1% increase in conversion from those lost users could generate $40 million in new annual revenue for the company.
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