For Immediate Release
Chicago, IL – June 7, 2021 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: GoodRx Holdings, Inc. GDRX, American Well Corporation AMWL, Accolade, Inc. ACCD, SOC Telemed, Inc. TLMD and Teladoc Health, Inc. TDOC.
Here are highlights from Friday’s Analyst Blog:
Booming Telehealth Market Lures More IPO, M&A Deals
Of late, European tech company UK healthtech's startup Babylon Health announced that it will go public in the United States via a merger. Babylon Health provides online consultations and also has a symptom-checking app.
This most recent deal brings into notice the increasing trend of public offerings and acquisitions taking place in the lucrative telehealth industry.
The COVID-19 pandemic understandably perked up the telemedicine market, buoyed by the universally mandated protocols of staying-at-home and social distancing. The size of the telehealth market is ballooning and more and more companies are thronging the space to grab a pie of the very promising industry.
Digital Health IPO Going Strong for the Third Straight Year
Even before the COVID-19 had hit hard, the digital health market was witnessing a ramped-up activity. Companies in the digital health space were actively expanding their scale and size as technological percolation was boosting virtual healthcare. In 2019, entities like Health Catalyst, Livongo Health, Phreesia and Change Healthcare went public. Speculations were rife then whether the IPO wave will continue blowing in 2020.
But the IPO trend gained further momentum with COVID-19 acting as a trigger. Remote healthcare gathered steam as people were forced to stay indoors to stem the coronavirus spread. Given that scenario, virtual healthcare was the only viable option left to address healthcare needs.
This led to a stratospheric rise in demand for products and services for online health monitoring. Many privately-held companies thus capitalizing on this current environment walked the IPO route to raise money from the public for expanding their scale and size. As evidence, in 2020, U.S. telehealth companies, namely GoodRx Holdings, American Well Corp., Accolade, SOC Telemed and many others went public.
In 2021, Hims & Hers Health, Inc. came out with an initial public offering. It is a multi-specialty telehealth platform that connects consumers to licensed healthcare professionals, thereby enabling medical care for multiple conditions related to mental health, sexual health, dermatology, primary care and more.
As IPOs are being floated, acquisitions of telehealth companies and other healthcare companies are also fast catching up.
This kind of buyouts helps players integrate vertically. It also suggests that the telehealth space is evolving rapidly and that companies wishing to get an instant presence are snapping up established players.
This year, Cigna purchased MDLive while UnitedHealthcare bought Change Healthcare to get an instant foothold in the telehealth market.
Investors' Most Desirable Place
Per MarketsandMarkets, the global telehealth market is expected to witness a CAGR of 37.7% over the 2020-2025 forecast period.
Experts say that the digital health sector is attracting people in droves and fetching in private investments because of a combination of strong product suite, soaring revenues, efficient management teams, and massive markets with promising potential.
With higher telemedicine uptake, the telehealth companies naturally made the most of it by generating wealthy returns for investors. For instance, Teladoc Health, the oldest company in the telehealth space, skyrocketed 139% in 2020 compared with its industry's average of 9.7%.
Looking back at 2019, it seemed that the digital health IPO was just the beginning. Even though telehealth became more popular in recent years, it continues to draw takers from the industry, courtesy of technological revolution and the relaxation of Medicare telehealth regulations.
There still exist many companies, which are privately held and backed by venture capitalists. These may come out in the market with public offering, keeping the IPO blitz alive.
Among the stocks mentioned above, Teladoc, American Well and SOC Telemed currently carry a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
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Teladoc Health, Inc. (TDOC) : Free Stock Analysis Report
American Well Corporation (AMWL) : Free Stock Analysis Report
GoodRx Holdings, Inc. (GDRX) : Free Stock Analysis Report
Accolade, Inc. (ACCD) : Free Stock Analysis Report
SOC Telemed, Inc. (TLMD) : Free Stock Analysis Report
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