Goldman Sachs downgraded Teladoc Health and slashed its price target by nearly 35% after the telemedicine company issued a weak forecast. Teladoc shares plunged 21% in premarket trading on Thursday. On Wednesday, the company lowered its third-quarter forecast , citing challenges around consumer sentiment, currency headwinds and wage inflation for the weaker outlook. “While TDOC posted solid results that were ahead of expectations for 2Q22, their guidance for the 3Q22 in terms of adjusted EBITDA was considerably below our expectations by 38%,” Goldman analyst Cindy Motz wrote. “Additionally, while they maintained guidance for the full-year 2022, they cautioned it was now more likely to be at the lower end due to the macro environment.” Goldman slashed Teladoc’s rating to neutral from buy and the stock’s 12-month price target was cut to $36 from $55. The new target represents about 17% downside from Wednesday’s closing price. Teladoc shares are down more than 50% year to date. Teladoc’s second-quarter results also included a $3 billion noncash goodwill impairment charge. The company has yet to see a return on its BetterHelp business, a mental health platform, though it is seeing growth in its chronic care and Primary360 platforms, the analyst said. Primary360 connects patients with primary care doctors online. “While our estimates were already at the very low end of guidance, we lower our estimates further (for adjusted EBITDA) because we do not think it is likely TDOC will be able to see the considerable ramp in adjusted EBITDA margins in 4Q22 as is now implied by 2022 guidance,” Motz wrote. Motz said she is still positive on the broader health-care technology sector, which is set for a boost from a further migration online, though macro challenges will present near-term hurdles for some companies. —CNBC’s Michael Bloom contributed to this report.
