Morning Wood: Shares Of Perennial ARK Favorite Teladoc Destroyed By More Than 40% After Earnings Meltdown

Shares of ARKK-favorite Teladoc (TDOC) have been absolutely mangled since the company posted an “alarming” outlook during its earnings report yesterday.

Shares are slated to open to day lower by about 40% after the company cut both its revenue and its earnings guidance. According to Bloomberg, analysts have been saying that the company’s outlook “fuels the bear argument” for the company. 

The company said it saw EBITDA at $39 million to $49 million for Q2, far below estimates of $71 million. For Q1, the company posted an EBITDA loss of $54.5 million versus a profit of $56.6 million from the year prior. 

CEO Jason Gorevic said: “While we continue to see sustainable growth across our suite of products and services, we are revising our 2022 outlook to reflect dynamics we are currently experiencing in the direct-to- consumer mental health and chronic condition markets. In the chronic condition market, we are seeing an elongated sales cycle as employers and health plans evaluate their long-term strategies to deliver the benefits and care that their populations need.”

Evercore analysts said that the deterioration in outlook since November is “particularly alarming” and that the company’s marketing spend is weighing on EBITDA.

Citi said that increasing competition has hurt the company’s growth and that “cracks” have been revealed in the business model. 

RBC called the results frustrating and said they didn’t expect “any signifiacnt long-only buying” until later in the year. Perhaps someone should give RBC Cathie Wood’s number…

Speaking of which, Wood was buying shares in Teladoc as recently as as 48 hours prior to the earnings blowup. It was reported that Wood added 44,940 shares of the company, worth $2.7 million, on Monday. Teladoc is ARKK’s #3 holding, with a 6.89% weighting. ARKK owns about 7% of the company, according to Cathie’s Ark. 

ARKK is trading near 52 week lows in the premarket session. 

Meanwhile, if anybody has been looking for Wood, she’s been partying in the Bahamas this week, apparently.

Fangirling hard. @CathieDWood’s landed at #cryptobahamas 👸 pic.twitter.com/tQieLArJAM

— Amy Wu (@amytongwu) April 27, 2022

TDOC shares have hit their lowest level since 2018, well before the pandemic.

Shares have nearly fallen 90% from the company’s highs during the pandemic, which was close to $300 per share.