Teladoc spikes as Jefferies cites short-term opportunity after BetterHelp data

Shares of Teladoc Health (NYSE:TDOC) rose ~7% premarket Tuesday after Jefferies cited a short-term opportunity in the telehealth provider following an analysis of web traffic data related to the company’s mental health business, BetterHelp.

Despite a Hold rating on the stock, the brokerage boosted TDOC’s price target to $10 from $8 per share in reaction.

Jefferies analyst Glen Santangelo pointed out that after 12 consecutive months of year-over-year declines, BetterHelp web traffic returned to growth in July/August. In contrast, the consensus estimates for Q3 indicate an 11% decline in BetterHelp revenue and ~ a 5% drop in total revenue, with several outlier data sets distorting the projections.

Given this negative sentiment and Teladoc’s (TDOC) short interest at ~16%, “we see a short-term opportunity in shares,” Santangelo added. However, “we appreciate long-term concerns may make it hard to sustain momentum,” the analyst cautioned.