Share of Teladoc Health (New York Stock Exchange code: TDOC) It has declined since the peak after the pandemic this summer, but the company’s business has not stopped growing at an alarming rate. Now that the stock has fallen to a more reasonable valuation, investment bank Baird upgraded it today and set its target price at $220, which is 18% higher than Thursday’s closing price.
Throughout the coronavirus pandemic, Teladoc’s services have received continuous strong support, which encouraged analysts. Teladoc’s provider network provided more than 2.8 million virtual visits in the third quarter, more than three times the number of visits in the same period last year.
The reason for the surge in the number of visitors is that new patients have received treatment opportunities, and the utilization rate has more than doubled year-on-year. Although more healthcare providers provided face-to-face services in the third quarter, Teladoc reported an annualized utilization rate 0.5% higher than in the second quarter.
Although some investors are upset about the company’s decision to merge with Livongo earlier this year, the combined business is already helping Teladoc win new customers. The cross-selling of new customers that occurred before the company officially completed the acquisition of Livongo at the end of October made Teladoc expect that bookings in the fourth quarter will be at least twice that of the third quarter.
Livongo helps people manage chronic health conditions with devices that track health signals and provide advice in real time. When Teladoc made the merger offer, Livongo’s flagship diabetes service had approximately 410,000 members, which was only a small portion of the 34.2 million Americans with diabetes.