Teladoc stock falls on earnings miss, TDOC stock down 30% after hours

TDOC stock collapses as it reports a disappointing earnings release after Wednesday's close.
Teladoc missed on both top (revenue) and bottom (EPS) lines.
TDOC shares are down nearly 40% this year but much worse from its 2021 high.

Ivan Brian FXStreet

Teladoc kept up its brutal performance this year as the stock fell sharply as it reported earnings after the close on Wednesday. Teladoc was another pandemic beneficiary as the stay-at-home dynamics led to a surge in the use of the service. Traders also saw the benefits of the service which was the perfect setup for lockdown. Retail traders jumped in and stretched the stock to valuation levels that were just unsustainable.

This is now being unwound across the stock market with multiple pandemic beneficiaries returning to levels not seen since early 2020. The most obvious example has probably been Peloton (PTON) and ARK Invest Innovation (ARKK). Teladoc is one of the top holdings in ARKK so more losses are on the cards and we deal with this in a separate report below.

See ARK Innovation (ARKK) latest here

Teladoc (TDOC) stock news: Call the doctor, this stock is dead

So let's get straight to it. The earnings were missed on the top and bottom lines. Earnings per share came in at wait for it -$41.58 versus the -$0.52 estimate. Now, that really is not a comparable figure because the -$41.58 includes a one-off goodwill impairment charge of over $6 billion. That means it adds -$41.11 to the loss meaning excluding that goodwill charge sees an EPS loss of -$0.47 versus the -$0.52 estimate. Revenue also missed coming in at $565.4 million versus the $568.7 million estimate.

Teladoc also gave guidance for the year ahead and it also was lower than previous estimates. Full-year revenue is now expected at $2.45 billion versus $2.58 billion expected. All told a weak set of numbers combined with a disappointing outlook sends the stock down over 30% in after-hours trading. Things are not looking any better this morning with little bounce in evidence and in fact at the time of writing TDOC stock is down 37% from Wednesday's close.

Teladoc (TDOC) stock forecast: No longs left

There is not much to say here, the chart says it all, pump and dumps look better than this! Admittedly this is a weekly chart so it has been more of a long slow painful torture for those long the stock. Surely there cannot be too many longs left now.

TDOC stock is now back to levels from mid to late 2017 and has some hope of stabilizing there given it was a long consolidation phase with reasonable levels of volume, but as we can clearly see markets are prone to stretching like an elastic band before snapping back to equilibrium.

TDOC stock clearly stretched too far on the upside and has now snapped back. It now may stretch too far to the downside given the current bearish overall market and the complete lack of momentum for TDOC stock. We have no good news to offer here. This one is damaged and is to be avoided until management at least turns the earnings around.

TDOC stock chart, weekly

Author

Ivan Brian

FXStreet

Ivan Brian started his career with AIB Bank in corporate finance and then worked for seven years at Baxter. He started as a macro analyst before becoming Head of Research and then CFO.

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