Teladoc (TDOC) shares are inching up after Citron Research likened them to a “coiled spring” – full of potential, compressed, and ready to surge with right catalyst – in its report on Tuesday.
According to the equity research firm, TDOC shares are worth owning for the long term given the growth potential embedded in its BetterHelp online therapy platform.
At the time of writing, Teladoc stock is down nearly 45% versus its year-to-date high set in February.
Why Is Citron Bullish on Teladoc Stock?
Citron sees the company’s $30 million acquisition of UpLift as “transformational” since it could deliver a meaningful boost to Teladoc’s revenue moving forward.
The aforementioned transaction, closed in late April, equips TDOC with “infrastructure to transition BetterHelp into a covered benefit,” the research firm added in its report.
Citron is convinced the world’s largest telehealth provider is undervalued at current levels given it has recurring revenue and a clear path to profitability.
The equity research firm took a bullish stance on Teladoc shares in its latest report because it offers scale that’s difficult to replicate as well.
AI Could Drive TDOC Shares Up in 2025
Teladoc is fully committed to integrating artificial intelligence (AI) into its operations, which could help improve its profitability over time, as per Citron’s report.
At a recent conference, the company’s executives said a mere 1% uptick in conversion could bring Teladoc an incremental $40 million in annual revenue, which Citron said is a strong enough reason to own TDOC shares.
All in all, Citron remains positive on Teladoc stock as the telehealth provider is “removing friction, unlocking reimbursement, and finally integrating mental health into broader healthcare system.”
Investors should also note that TDOC reported a market-beating Q1 and offered in-line guidance for the current quarter in late April.
Wall Street Is Also Bullish on Teladoc Health
Wall Street analysts seem to agree with Citron’s confidence in TDOC stock given the consensus rating on the telehealth provider currently sits at “Moderate Buy.”
At the time of writing, analysts have a mean target of about $9.22 on shares of the virtual healthcare company, which indicates potential upside of some 15% from current levels.
