Can Teladoc (TDOC) Q2 Earnings Navigate BetterHelp Profit Woes?

In its upcoming report, Teladoc is predicted by Wall Street analysts to post quarterly loss of $0.35 per share, reflecting an increase of 12.5% compared to the same period last year. Revenues are forecasted to be $649.56 million, representing a year-over-year decrease of 0.4%.

The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This reflects how the analysts covering the stock have collectively reevaluated their initial estimates during this timeframe.

Before a company reveals its earnings, it is vital to take into account any changes in earnings projections. These revisions play a pivotal role in predicting the possible reactions of investors toward the stock. Multiple empirical studies have consistently shown a strong association between trends in earnings estimates and the short-term price movements of a stock.

While investors typically use consensus earnings and revenue estimates as indicators of quarterly business performance, exploring analysts' projections for specific key metrics can offer valuable insights.

Given this perspective, it's time to examine the average forecasts of specific Teladoc metrics that are routinely monitored and predicted by Wall Street analysts.

Analysts predict that the 'Revenues by Segment- BetterHelp' will reach $273.85 million. The estimate points to a change of -6.3% from the year-ago quarter.

It is projected by analysts that the 'Revenues by Segment- Teladoc Health Integrated Care' will reach $374.76 million. The estimate indicates a year-over-year change of +4.1%.

The combined assessment of analysts suggests that 'Revenues by Segment- BetterHelp- Therapy Services' will likely reach $269.86 million. The estimate indicates a year-over-year change of -6.4%.

The collective assessment of analysts points to an estimated 'Revenues by Segment- BetterHelp- Other Wellness Services' of $5.16 million. The estimate indicates a change of +26.8% from the prior-year quarter.

Analysts expect 'Revenue by Type- Access fees' to come in at $564.53 million. The estimate indicates a change of -1.9% from the prior-year quarter.

The average prediction of analysts places 'Revenue by Type- Other' at $84.83 million. The estimate suggests a change of +10.5% year over year.

Based on the collective assessment of analysts, 'U.S. Integrated Care Members' should arrive at 92.39 million. The estimate is in contrast to the year-ago figure of 85.9 million.

Analysts' assessment points toward 'Visits' reaching 5,171,145. The estimate compares to the year-ago value of 4,700,000.

The consensus estimate for 'Adjusted EBITDA- BetterHelp' stands at $25.48 million. The estimate compares to the year-ago value of $34.19 million.

The consensus among analysts is that 'Adjusted EBITDA- Teladoc Health Integrated Care' will reach $50.25 million. Compared to the current estimate, the company reported $37.97 million in the same quarter of the previous year.

View all Key Company Metrics for Teladoc here>>>

Shares of Teladoc have demonstrated returns of -4.2% over the past month compared to the Zacks S&P 500 composite's -0.2% change. With a Zacks Rank #4 (Sell), TDOC is expected to lag the overall market performance in the near future. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here

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The earnings reports of last week were a mixed bag, with some Tesla, Inc. , Alphabet, Inc. and STMicroelectronics N.V. , among companies disappointing to the downside. As the focus shifts to the unfolding week, more tech companies are lined up to disclose their quarterly results, potentially offering cues regarding the health of the sector.

The Week That Was: Most on Wall Street viewed Tesla’s earnings as lacking quality because a significant portion of them came from one-time regulatory credits. On the other hand, Google-parent Alphabet alienated investors by flagging higher capex that will likely weigh down on margins and in turn the bottom line.

Franco-Italian chipmaker, which is a key supplier to the automotive market, cut its full-year guidance. But not all tech tidings were received with pessimism. International Business Machines Co. rose as investors cheered the company’s strong artificial intelligence bookings.

Healthy Trend: Data from financial data analytics company FactSet showed that about 14% of the S&P 500 companies have reported their quarterly results so far. The percentage of S&P 500 names that reported upside earnings surprise is 80%, above the one-year average (78%), five-year average (77%), and 10-year average (74%). But the percentage of upside was sub-part at 5.5%, below the one-year average (+6.5%), five-year average (+8.6%), and 10-year average (+6.8%).

The blended earnings of S&P 500 companies are expected to grow by 9.7%, the fastest pace since the fourth quarter of 2021. Eight of the 11 S&P 500 companies are on track to report year-over-year earnings growth for the June quarter, with communication Services, healthcare, IT, and financials likely reporting double-digit growth.

On the other hand, the materials space is expected to witness the steepest earnings decline.

See Also: Best Tech Stocks Right Now

The Week Ahead: According to FactSet, this week will feature earnings reports from 138 S&P 500 companies, including seven components of the Dow 30. Some heavily-weighted companies such as Apple, Inc. , Microsoft Corp. and Meta Platforms, Inc. are all in the mix.

Meta is expected to be the largest contributor to earnings per share growth, given the consensus models nearly 60% increase.

After last week’s brutal tech sell-off, a bullish analyst is optimistic concerning the the sector, its prospects and the stock trajectory. “We believe the tech sell-off seen last week will be short-lived as the Street better digests results and commentary from the broader tech sector over the coming weeks during 2Q earnings season,” Wedbush’s Daniel Ives said in a note published Sunday.

“This is the start....not the end of this tech bull run we expect the next few years,” he said, adding that companies, utilities,

governments will spend over $1 trillion combined in AI capex over the coming years fueling this AI Revolution.

The analyst said investors will likely look for clues around the pace of AI revolution from the earnings reports of Microsoft, Amazon, Inc. , Meta and Apple and others.

Tech stocks extended their weekly declines in the week ended July 26 amid the disappointment from early tech reporters. The Invesco QQQ Trust , an index that tracks the performance of the Nasdaq 100 Index, ended Friday’s session down 1.03% to $462.97, according to Benzinga Pro data. The ETF is trading off its record close of $502.96 reached on July 10. The SPDR S&P 500 ETF Trust climbed 1.12% on Friday before closing at $5544.44. The QQQ and SPY climbed 0.48% and 0.25%, respectively, in premarket trading Monday.

Notable among the companies reporting this week are:

Monday

Before market open:

• McDonald’s Corporation 
• ON Semiconductor Corporation 

After close:

• F5, Inc.
• Rambus Inc.
• Lattice Semiconductor Corporation
• Chesapeake Energy Corporation
• Sanmina Corporation
• Tilray Brands, Inc.

Tuesday

Before market open:

• American Electric Power Company, Inc.
• Archer-Daniels-Midland Company
• BP p.l.c.
• Illinois Tool Works Inc.
• JetBlue Airways Corporation
• LGI Homes, Inc.
• Logitech International S.A.
• Merck & Co., Inc.
• PayPal Holdings, Inc.
• Pfizer Inc.
• Procter & Gamble Company
• Restaurant Brands International Inc.
• SoFi Technologies, Inc.

After close:

• Advanced Micro Devices, Inc.
• Arista Networks, Inc.
• Caesars Entertainment, Inc.
• DoubleVerify Holdings, Inc.
• Electronic Arts Inc.
• First Solar, Inc.
• Freshworks Inc.
• Live Nation Entertainment, Inc.
• Match Group, Inc.
• Microsoft
• Mondelez International, Inc.
• Pinterest, Inc.
• Skyworks Solutions, Inc.
• Starbucks Corporation
• Qorvo, Inc.

Wednesday

Before market open:

• Altria Group, Inc.
• AutoNation, Inc.
• Barrick Gold Corporation
• Bausch + Lomb Corporation
• Boeing Company
• DuPont de Nemours, Inc.
• Garmin Ltd.
• GSK plc
• Humana Inc.
• KKR & Co. Inc.
• Kraft Heinz Company
• Oshkosh Corporation
• Teva Pharmaceutical Industries Limited
• Marriott International, Inc.
• Wingstop Inc.
• T-Mobile US, Inc.
• Norwegian Cruise Line Holdings Ltd.

After close:

• Albemarle Corporation
• American International Group, Inc.
• Arm Holdings plc
• C.H. Robinson Worldwide, Inc.
• Carvana Co.
• eBay Inc.
• Etsy, Inc.
• Host Hotels & Resorts, Inc.
• Lam Research Corporation
• Meta
• MGM Resorts International
• NETGEAR, Inc.
• QUALCOMM Incorporated
• Teladoc Health, Inc.
• Western Union Company

Thursday

Before market open:

• Anheuser-Busch InBev SA/NV
• Bausch Health Companies Inc.
• Biogen Inc.
• ConocoPhillips
• Dominion Energy, Inc.
• EVgo, Inc.
• Hershey Company
• Hertz Global Holdings, Inc.
• Mobileye Global Inc.
• Regeneron Pharmaceuticals, Inc.
• Sirius XM Holdings Inc.
• Cigna Group
• Wayfair Inc.

After close:

• Amazon
• Apple
• Beazer Homes USA, Inc.
• BigBear.ai Holdings, Inc.
• Block, Inc.
• Booking Holdings Inc.
• Cloudflare, Inc.
• Clorox Company
• Coinbase Global, Inc.
• DraftKings Inc.
• Intel Corporation
• Microchip Technology Incorporated
• MicroStrategy Incorporated
• Opendoor Technologies Inc.
• RingCentral, Inc.
• Roku, Inc.
• Vertex Pharmaceuticals Incorporated
• Twilio Inc.
• United States Steel Corporation

Friday

Before market open:

• Chevron Corporation
• Exxon Mobil Corporation
• Magna International Inc.
• Cinemark Holdings, Inc.
• Fluor Corporation

After close:

• AMC Entertainment Holdings, Inc.

Read Next:

• Alphabet Investors Fret Over Margin Impact Of Higher AI-related Capex, But Fund Manager Says Not Spending Enough Exposes Google’s Parent To Risk Of ‘Losing Their Grip On The Future’

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The latest trading session saw Teladoc ending at $9.30, denoting a +1.2% adjustment from its last day's close. The stock outperformed the S&P 500, which registered a daily loss of 0.16%. At the same time, the Dow lost 0.14%, and the tech-heavy Nasdaq lost 0.06%.

The the stock of telehealth services provider has fallen by 11.29% in the past month, lagging the Medical sector's gain of 0.37% and the S&P 500's gain of 1.96%.

The investment community will be closely monitoring the performance of Teladoc in its forthcoming earnings report. The company is scheduled to release its earnings on July 31, 2024. On that day, Teladoc is projected to report earnings of -$0.35 per share, which would represent year-over-year growth of 12.5%. Alongside, our most recent consensus estimate is anticipating revenue of $649.56 million, indicating a 0.44% downward movement from the same quarter last year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of -$1.05 per share and a revenue of $2.65 billion, signifying shifts of +21.64% and +1.8%, respectively, from the last year.

Any recent changes to analyst estimates for Teladoc should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. At present, Teladoc boasts a Zacks Rank of #4 (Sell).

The Medical Services industry is part of the Medical sector. With its current Zacks Industry Rank of 98, this industry ranks in the top 39% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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