While most of the sectors, economies and companies are suffering due to the coronavirus pandemic, telehealth service provider Teladoc Health, Inc. (TDOC - Free Report) continues to witness growth.
In the recent years, its telehealth services have been witnessing increase in demand, due to cost effectiveness, flexibility and consultation provided.
However, the COVID-19 pandemic has caused a spurt in the demand for its telehealth services as patients chose to stay away from any kind of physical contact to prevent the spread of the disease.
Year to date, the stock has gained a solid 90.5% against its industry 's decline of 19.3%.
Despite the U.S. government’s measures to make telemedicine mainstream for the past few years, primarily to minimize healthcare cost and increase access of care, the sector is yet to receive mass acceptance.
Nevertheless, post the COVID-19 outbreak, the situation has drastically changed. A TIME report states, “If extreme measures like mass quarantines come to pass, telehealth could finally have its bittersweet moment in the spotlight, potentially generating momentum that proponents hope will continue once life returns to normal.”
Earlier in the month, the company announced that it experienced unprecedented daily visit volume in the United States amid the coronavirus crisis. In the second week of March, patient visit volume spiked 50% over the prior week (served 100,000 virtual medical visits) and continued to rise.
Teladoc is the only listed company in the United States providing health and medical consultation services via telephone and video calls. It clearly enjoys the first mover advantage in the telehealth industry. Its scale and size is unmatchable compared with other players in the industry. The company has done a commendable job of complementing its organic growth with inorganic measures through a number of acquisitions in the past three to four years.
Recently, Teladoc took its business to international locations. This will further provide it with benefits of geographical diversification. Its offices in 11 other countries and telehealth service delivery to patients in more than 175 countries give it an enormous international market opportunity.
The company’s wide telehealth network and increasing number of clients further poise it for long-term growth. Its customers include 40% of the Fortune 500 and many of smaller organizations. More than 50 major U.S. health plans use Teladoc's telehealth offerings. At least 70 international insurance and financial services firms avail its services.
Further, the recent inclusion of telehealth services by the CMS for medicare reimbursement opens a new chapter for the company.
Teladoc carries a Zacks Rank #3 (Hold). Some companies providing telehealth services during the coronavirus pandemic are UnitedHealth Group Inc. (UNH - Free Report) , Magellan Health, Inc. (MGLN - Free Report) and Humana Inc. (HUM - Free Report) among others. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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