What Happened?
Shares of digital medical services platform Teladoc Health (NYSE: TDOC) jumped 13.5% in the morning session after the company reported fourth-quarter results that surpassed analyst expectations, along with a narrower loss, even as it provided a cautious outlook for the year ahead. The virtual healthcare company posted revenue of $642.3 million, which was slightly ahead of Wall Street's estimates. A key positive for investors was the improvement on the bottom line, with the quarterly loss per share narrowing to $0.14 from $0.28 in the same period of the previous year. This result also beat market forecasts. However, the company's guidance for the upcoming first quarter and the full year 2026 came in below what analysts had anticipated. Despite the soft forecast, the market's positive reaction suggested investors placed more weight on the strong quarterly performance and improved profitability.
Is now the time to buy Teladoc? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Teladoc’s shares are extremely volatile and have had 36 moves greater than 5% over the last year. But moves this big are rare even for Teladoc and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 30 days ago when the stock dropped 5.6% on the news that BofA Securities lowered its price target on the stock as concerns grew over expiring Medicare telehealth reimbursements. The bank reduced its price target to $7.00 from $7.50, keeping a Neutral rating. The firm pointed to a nearly 19% year-over-year drop in monthly active users for Teladoc's BetterHelp service in the fourth quarter. Analysts also noted ongoing pressure on the service due to weak consumer sentiment. Adding to the negative mood, telehealth reimbursement provisions for Medicare patients were set to expire at the end of January. This change was expected to limit payments for at-home services, which would likely reduce demand for the company's offerings. Teladoc had already been experiencing slow revenue growth and struggles with its BetterHelp service before this news.
Teladoc is down 24.5% since the beginning of the year, and at $5.32 per share, it is trading 51.6% below its 52-week high of $10.99 from February 2025. Investors who bought $1,000 worth of Teladoc’s shares 5 years ago would now be looking at an investment worth $24.07.
The 1999 book Gorilla Game predicted Microsoft and Apple would dominate tech before it happened. Its thesis? Identify the platform winners early. Today, enterprise software companies embedding generative AI are becoming the new gorillas. Click here for access to our special report that reveals one profitable leader already riding this wave, it’s free.
