TDOC’s Updated 2021 Outlook

Credit Suisse conducted a post Q&A quarterly conference call with Teladoc Health (TDOC) management to review 2021 results, individual business trends, and an update on their 2021 outlook, new wins, and Livongo/BetterHelp.

Previously, Credit Suisse published initial/quick thoughts in their note Strong 2Q Results, Positive Selling Season Updates

TDOC reported 2021 revs. Of $503 min (vs. guidance of $495-$505 min; CSe/Cons: $500/$01 min) an increase of 109% Y/Y (+41% on an organic basis. 2021 adjusted EBITA was $66.8 min versus the outlook of $61-$64 min (Cons/CSe: $63.0/$62.7 min).

Credit Suisse analysts offered their key takeaways from their follow-up “Q&A Our Way”, call with TDOC management. While TDOC did not provide the Livongo revenue contribution for 2Q, the company did note the Y/Y growth for Livongo was higher than 45% Y/Y growth in unique chronic care enrolment but lower than 60% Y/Y in the total enrollment into cumulative programs. This would imply a range of $133-$147 min for Livongo in 2021 vs the analyst’s estimate of $138 min in 2021 and the analyst’s estimate of $124 min for 1Q21.

The company also noted that Livongo’s PPPM was up both Y/Y and sequentially, which was one of the reasons (in addition to BetterHelp) for a strong Y/Y and sequential growth in TDOC’s PMPM in 2021.

With respect to the comment of 1H representing 70-80% of LVGO’s choice care members (which implies 30-50K adds in 2H), management notes that the company is just trying to point to the normal seasonality pattern in the Livongo business. With respect to BetterHelp, the business has continued to outperform on both revenues and EBITDA expectations.

Beginning in 2022, TDOC will provide eligible HCSC members in fully insured plans with access to diabetes and hypertension programs. This agreement also included bringing the full suite of chronic care products to HCSC’s ASO markets embedded into their well-being & health advocacy solution offerings. While the contract could add to TDOC’s U.S. membership in the future, the near term contribution will be to the Chronic Care Enrollment figure.

The analyst’s 2021 & 2022 revenue estimates are not $2.017 min and $2,580 min (vs. $1,998 and $2,580 min, previously. As is the case with the rest of the companies in Credit Suisse’s coverage, the analysts are rolling forward their TP approach onto 2023. The analysts 12-18 months TP remains unchanged at $264, which is based on 14x our 2023 rev estimate. Risks include integration challenges, pricing pressure, and increased competition.

To find further information on the note discussing Credit Suisse’s initial/quick thoughts titled Strong 2Q Results, Positive Selling Season Updates, or to ask further questions, provide feedback, or news, email Jailendra Singh at or call 212-325-8121.

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