There is no doubt that investing in high-quality stocks over the long term is the best path to financial independence. However, there are ways for investors to expedite this process, by finding companies that have the potential to increase their initial investment multiple times. There are a number of factors incorporated in this rare breed that can produce life-changing returns.
Solving old problems in a new way, starting a long-term trend or developing a successful product with a remarkable market can be a sign of a game-changing investment.
Finding a company that owns each of these traits will definitely increase your chances of success. But what if you could find two such companies and get two companies for the price of one company? Actually, you can. Opportunity? Teladoc Health (NYSE: TDOC).
Telehealth was well known before the emergence of coronavirus, but with the pandemic continuing to spread rapidly, patients are taking telehealth more than ever. The ability to deal with medical concerns without going to a health clinic or doctor’s office is the wave of the future, and no company is in a better position to be more successful than Teladoc Health. The company is a global leader in virtual wellness services, providing app-based video chats with a doctor from the comfort of your home.
The numbers speak for themselves. In the second quarter. Teladoc generated 85% year-over-year increase in revenue, with subscription revenue up 64% and access fee revenue up 209%. Some of the underlying trends in the US are even stronger than the numbers show, as revenue from paid visits increased 159%, while revenue from paid visits increased 449%. . Teladoc’s international growth is only just beginning, giving the company a long way to go.
The skyrocketing number of patients using telemedicine is as evidenced by the number of visits. The total number of visits generated by US paid members increased 227% to nearly 1.2 million, while the number of visits generated by only 306,000 members increased by 468%. At the same time, 453,000 international visitors increased by 85%. The total number of visits is nearly 2.8 million, up 203% from last year.
If that’s not enough reason to buy this game-changing stock, Teladoc has another ace.
Representative card consolidation
Teladoc has made a number of acquisitions over the years, but none more surprised them than its plan to merge with Livongo Health (NASDAQ: LVGO), offers a new, application-based solution that combines mobile devices to help patients cope with chronic illnesses.
Estimates vary, but Livongo’s management says up to 147 million Americans have at least one chronic illness, including diabetes. The company is working to help these patients by developing coping strategies and mechanisms to deliver better results, thereby improving quality of life and reducing overall healthcare costs. surname. Livongo uses advanced algorithms and artificial intelligence to detect similarities in a patient’s condition, then provide customized feedback in the form of suggestions and incentives to keep the patient on the right track. medical examinations.
The company first tackled diabetes management, but has since added to its product line that covers conditions as diverse as weight management, hypertension, and health issues. en (including depression and anxiety), and seek to expand into other use cases.
The success of the Livongo program for diabetes helps illustrate the potential for these more recent supplements. Enrollments increased 113% year-on-year in the second quarter, bringing in $ 92 million in revenue, up 125%. At the same time, the company’s overall customer base grew by 75%.
A large and growing market
Teladoc Health and Livongo Health announced in early August that they would merge to “create a new standard in global healthcare delivery, access and experience” in an 18-value agreement, 5 billion USD. By combining leaders in the virtual care field and chronic condition management, companies believe they will be in “a unique position to tap into the full potential of virtual care.” The deal is expected to close at the end of the fourth quarter and is rapidly approaching.
Each company has had an impressive market opportunity, with Teladoc and Livongo citing $ 30 billion and $ 34 billion in settable markets, respectively. But with the opportunity to cross-sell, add, and recommend, the companies now believe that the market is likely to have their combined address reach $ 121 billion, and that’s only in the United States.
To put that number into context, the combined company is expected to generate only $ 1.3 billion in revenue this year, showing how large the opportunity remains.
Are Teladoc and Livongo a sure investment?
It’s important to understand that while Teladoc and Livongo have been able to make impressive profits so far, there’s a lot they’ll have to do right for that growth to continue. In addition, investors need to be willing to pay for opportunities. Livongo and Teladoc are currently priced at 38 and 18 times their futures sales, when a price-to-sales ratio between 1 and 2 is considered reasonable. But given their achievements, I’m happy to see what the future holds.
As the two winners have proven synergies to disrupt the healthcare industry, investors could be among the ultimate beneficiaries.