It’s no secret that Teladoc Health (NYSE: TDOC) has been skyrocketing in recent months. If you’ve been following the stock market, you’ve probably heard of the massive surge in demand for telehealth services in the wake of the pandemic, and Teladoc has been one of the biggest beneficiaries of this trend. It’s undeniable that Teladoc’s stock has had a huge boost due to recent market trends, but there are other factors at play that suggest this upward trajectory may not be slowing down any time soon.
The pandemic has shifted our approach to healthcare, with increasing numbers of patients relying on virtual consultations and telehealth services. Teladoc is one of the pioneers of telehealth, providing remote access to medical professionals via smartphones, laptops, and other devices. The ease of access to medical consultations from the comfort of your own home has attracted a rapidly growing user base.
The numbers don’t lie: according to the company’s earnings report, Teladoc’s revenue in Q2 2021 increased by a whopping 109% compared to the same period in the previous year. Additionally, the company’s active members increased by 51%, bringing its total member count to 52.3 million. It’s clear that demand for Teladoc’s services is high and continuing to grow.
Even with the pandemic easing and in-person consultations beginning to return, experts predict that telehealth is here to stay. Research from McKinsey & Company indicates that the number of US patients using telehealth could potentially stabilise at 21% after the pandemic subsides – a significant increase from 11% in 2019. So not only is Teladoc experiencing a short-term boost during the pandemic, it looks poised to benefit from a broader trend shift towards telehealth in the long term.
Breaking into international markets
While Teladoc has seen great success in the US, the company also has its eye on expanding its reach across the globe. In 2020, Teladoc merged with Livongo in a deal worth $18.5bn to expand into remote patient monitoring. Livongo’s technology tracks vital signs and with the merger, will work alongside Teladoc’s virtual health platform.
The merger also provided Teladoc with a new entry point into international markets. Livongo was already established in Europe in the United Kingdom and is expanding into Germany, Spain, and France.
These moves could help Teladoc to cement its position as the world’s top telemedicine provider – a position the company is already gaining a reputation for as its share prices continue to rise.
Partnerships with major companies
Teladoc has also been forging partnerships with some big players in the business world. In July, the company announced a new partnership with Microsoft. Teladoc’s platform will be integrated with Microsoft Teams, allowing for virtual visits with healthcare providers without leaving the Teams interface. This partnership will likely further increase Teladoc’s reach and market share in the telehealth space.
Additionally, last year, Teladoc announced partnerships with both Walmart and CVS Health, two of the biggest retailers in the US. The companies’ customers now have access to Teladoc’s services directly through those brands, creating a new pathway for customer acquisition for Teladoc.
Teladoc also announced partnership with Amazon last year, fueling further price moves and rumors are going around that it could partner with Tesla.
The way in which healthcare is changing due to the pandemic likeliness and is likely to increase the value of companies like Teladoc over the long-term. Larger corporate players are looking to invest in telehealth in order to stay ahead of the curve, meaning that Teladoc is likely to be in high demand when it comes to strategic partnerships in the coming months and years.
Potential merger or acquisition
Teladoc’s growing influence on the telehealth landscape has led to speculation of a potential merger or acquisition in the near future. There’s no concrete evidence to support these rumors, but with the company seeing rapid growth and interest in the telehealth sector still high, it would make sense for an industry leader to scoop up Teladoc at a premium.
What’s more, Teladoc’s existing access to data through remote patient monitoring and virtual consultations has the potential to be disruptive to the insurance and pharmaceutical industries. With telehealth services becoming a more accepted means of delivering healthcare, the value of this data is likely to increase, which could attract potential suitors.
As mentioned earlier, Teladoc and Livongo’s merger was groundbreaking and expanded Teladoc’s offerings. It’s not impossible that with further investment or expansion, Teladoc could become an even bigger player on the telehealth stage, one hotly sought after by industry players or investors.
The bottom line
In all likelihood, Teladoc’s growth isn’t going to slow down any time soon. With more patients taking an interest in telehealth services, companies looking for strategic partnerships, and strong financials, the future looks bright for the telemedicine firm. Patients and investors alike are recognizing the value and convenience of remote consultations, a trend that’s likely to keep progressing. The rise of telehealth is a story that isn’t going away anytime soon, and Teladoc Health is at the forefront.
