Healthcare portfolios include telehealth stocks, notably after the COVID-19 pandemic, which increased global telemedicine usage, demonstrating their importance for lockdowns and other social isolation scenarios.
The worldwide telehealth market was $122.2 billion in 2023 and is anticipated to rise 28.4% annually from 2024 to 2032. Another forecast predicts $368.7 billion in market growth at 40% per year from 2023 to 2028.
North America led the market in 2023 owing to higher healthcare IT spending, more internet and smartphone users and early smart healthcare adoption. Asia-Pacific is predicted to develop fastest in the next years due to an aging population, digital health advances and effective government policies.
Additionally, many Medicare telehealth flexibilities are extended until 2026 under the Preserving Telehealth, Hospital and Ambulance Access Act. That involves offering audio-only telehealth, remote telemental health treatments and eliminating in-person appointments.
A Dana-Farber Cancer Institute study also indicated that telemedicine may considerably cut cancer treatment greenhouse gas emissions.
Under these circumstances, telehealth stocks will only gain favor with the investing community. That’s why we’ll explore three undervalued telehealth stocks, each with upsides of more than 50%. All of them are down this year, making them great contrarian plays.
Teladoc Health (TDOC)
Teladoc Health (NYSE:TDOC) is down 56% this year due to reporting lackluster quarterly earnings and mixed guidance, but analysts are projecting a 73% upside for the TDOC, based on a target price of $16.28.
TDOC’s first-quarter 2024 net loss was $81.9 million, or 49 cents per share. Experts expected a 47-cent loss per share. The quarter showed $646.13 million in revenue, up 2.7% from the previous year. Despite producing more money, the firm is struggling due to excessive marketing and operating expenditures.
On a positive note, however, Teladoc has expanded its virtual nursing program in response to the national nurse shortage.
Teladoc’s apps also help with diabetes, hypertension and weight loss. These programs improve blood pressure and glucose control by integrating physical and mental health activities.
All of these business areas will likely improve with Chuck Divita now at the helm as the CEO of Teladoc. Divita brings extensive knowledge from his previous jobs in the healthcare business to his new position, helping TDOC realize its projected upside and making it one of the best telehealth stocks.
Health Catalyst (HCAT)
Health Catalyst (NASDAQ:HCAT) has been facing severe selling pressure in recent months despite beating earnings estimates handily in its latest quarterly report. Nevertheless, HCAT, down 29% in 2024, is an excellent contrarian play among telehealth stocks, with analysts projecting a 70% upside based on a target price of $11.
Apart from the recent earnings beat, Health Catalyst bought Carevive Systems, a company focused on oncology-related technologies. To enhance Health Catalyst’s cancer therapy, the acquisition combines Carevive’s clinical trial screening, treatment planning, care coordination and remote patient monitoring systems.
Health Catalyst is also a partner with Contexture, the largest western HIE. The partnership will increase data accessibility and performance improvement support by uniting Contexture’s technology systems.
Health Catalyst also operates Healthcare.AI, a set of augmented intelligence solutions and services for healthcare concerns. This new software package expands AI applications in healthcare, enabling clinical and administrative decision-making.
Also, Ignite is an advanced data and analytics tool from HCAT made for healthcare companies. Modern technology, data models designed for healthcare and self-service options make it easier to run operations and make decisions, making it a vital component of HCAT’s portfolio.
LifeMD (LFMD)
LifeMD (NASDAQ:LFMD), with a 104% upside and a Strong Buy rating, is one of the best telehealth stocks in the world.
It reported an outstanding first quarter of 2024, with $44.1 million in sales, a 33% year-over-year gain. The business also saw a big rise in telemedicine income and new subscribers. LifeMD raised its full-year sales forecast to at least $205 million. To broaden its market, the company will begin accepting business insurance in the second quarter of 2024.
By the end of the first quarter, the weight management business added more than 20,000 new customers and 42,000 users. Moreover, given the frenzy over Ozempic and other weight-loss medications, this sector will probably grow rapidly and favorably for LifeMD’s performance.
Additionally, LifeMD is the first virtual primary care provider to offer GLP-1 patients real-time blood pressure and body composition monitoring at home.
The company also continues to release Rex MD products. Two new product categories were introduced in the second quarter of 2024. This is part of the company’s plan to enhance its fast-growing lifestyle in the healthcare sector.
Plus, Medifast (NYSE:MED) and LifeMD developed a GLP-1 weight-loss program. The combination of LifeMD’s virtual platform with Medifast’s habit-based, coach-led lifestyle solutions promises to revolutionize weight reduction. This partnership increased LifeMD’s stock price and market importance.
On the date of publication, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.