Key Takeaways
See the earnings release here and the Q4 investor presentation here.
- Revenue | $554 million, +45% YoY.
- Beat analysts estimates of $547 million.
- Beat guidance of $541 million.
- Adjusted EBITDA | $77.1 million, +53% YoY. Beat estimates of $72 million.
- FY22 Guidance
- Revenue | $2.55 – $2.65 billion ($2.57 billion analyst est.)
- Adjusted EBITDA | $330 – $355 million ($353 million analyst est.)
Company Overview
- Teladoc Health (TDOC) is a provider of virtual healthcare services.
- The company provides a portfolio of services and solutions including various medical subspecialties from non-urgent, episodic needs, like flu and upper respiratory infections, to chronic, complicated medical conditions, like hypertension, cancer, and congestive heart failure.
- Teladoc believes that telehealth macro trends were accelerated by the impacts of the global pandemic as it drove more consumer trial and use of virtual care.
- TDOC’s clients consists of employers, including over 50% of the Fortune 500, health plans, health systems, and insurance and financial services companies.
- The company completed over 15 million telehealth visits in 2021.
Q4 Earnings Highlights
Operational
- 53.6 million U.S. paid members, +3.5% YoY
- Total visits (Q4) | 4.41 million, + 41% YoY
- Total visits (FY) | 15.4 million, +38% yoY
- Chronic care enrollment | 729,000, +22.3% YoY
Financials (Three months ended Dec 31)
- Revenue | $554 million, +45% YoY. Beat analysts estimates of $547 million.
- Organic growth rate of 32%
- Average revenue per member of $2.49, up from $1.63 a year ago.
- Adjusted EBITDA | $77.1 million, +53% YoY. Beat estimates of $72 million.
- Note: Includes $61.6 million of SBC.
Financials (FY 2021)
- Revenue | $2.03 billion, +86% YoY
- Adjusted EBITDA | $267.8 million, +111% YoY
- Cash flow from operations | $194.0 million
Guidance
- FY22 revenue guidance is in line with analyst expectations
- FY22 adjusted EBITDA guidance is also in line with expectations
Management Commentary
Jason Gorevic, CEO
- “We successfully delivered against performance metrics, solidified our position as the partner of choice for our clients, and connected millions of consumers with high-quality care.”
- “We saw meaningful growth and penetration across several key areas of our business, in mental health through both BetterHelp in the direct-to-consumer space and our new MyStrength Complete B2B2C approach to right care at the right time, as well as primary care through Primary 360, all helping to meet a greater share of an individual’s healthcare needs.”
- “Healthcare has a ‘new normal’ resulting from the pandemic’s intersection of health needs and virtual solutions that has forever changed the experience of healthcare.”
Valuation + Analysis
- At $64.10, TDOC is trading at a $9.2 billion enterprise value.
- Using the midpoint of Teladoc’s adjusted EBITDA guidance for FY22, the company is trading at around 35x adjusted EBITDA.
- A large portion of the EBITDA adjustment is SBC, though some of the SBC numbers are elevated this year and last year due to acquisition costs.
KR: It was a uneventful quarter for Teladoc as a business. It is still working on expanding margins while growing the business organically and through M&A. Guidance was in line with expectations. The company remains committed to its FY24 revenue target of $4 billion. Teladoc expects growth to continue between 25-30% compounded annually through 2024.
The stock has been re-rated down as growth stocks get hammered. its has been noted within reviews of Teladoc that software is not great which kept would keep me away from the stock along with the general move away from high-valued, retail-owned growth names. It may be interesting here, but it would take serious time and effort to gain conviction behind this stock.
