Top 5 Telehealth Stock Buys in March 2020

The telehealth sector is gaining popularity - top five stocks

The telehealth sector is gaining in popularity, and the coronavirus outbreak will only play to its strengths.

Telehealth platforms remove the need for all types of face-to-face meetings between doctors and patients. Instead of visiting a surgery, telehealth connects people via streaming or other digital services.

The service cut costs, and because it is a new area of medicine, there are very few pure-play telehealth traded stocks out there.

In the current situation, a platform that allows people to receive medical attention during a global public health emergency without travel is a powerful tool for doctors.

Most of these firms are traded using trading platforms on major stock exchanges, but there are a number of start-up ventures that may float over the next few years, and so are worth keeping an eye on.

Teladoc Health (NYSE: TDOC)

Teladoc Health (formerly Teladoc) is the only pure-play telehealth stock in the US. It has been an innovator in the field and has seen its shares surge from around $70 to above $136 over the last six months.

As a pure-plan telehealth company, New York-based Teladoc has reported that over the last week, it has seen the use of its platform more than double due to the coronavirus pandemic. The stock has been handed numerous buy ratings by investment banks including Oppenheimer and Guggenheim.

Cigna (NYSE: CI)

Bloomfield-based Cigna is a big name in US healthcare, and it offers its own telehealth program. Anyone who is an existing Cigna customer can opt-in to its telehealth platform, which will connect patients with either a doctor or nurse on a round-the-clock basis.

While telehealth is currently a small part of Cigna’s overall business, it is likely to grow as the healthcare industry adapts to new challenges. For the moment, Cigna’s shares are under pressure, but the stock does carry a buy rating at both Goldman Sachs, and UBS.

Humana (NYSE: HUM) 

Humana is another US healthcare heavyweight. While its shares have been sold by investors recently, it does have substantial exposure to telehealth via its Humana At Home and Kindred at Home programs. Like Cigna, Humana allows customers to use a telehealth platform to connect with doctors and nurses and is well placed to expand this business. The Louisville group currently has many buy and hold ratings, with buy ratings from Goldman Sachs and Mizuho.

CVS Health (NYSE: CVS)

Rhode Island-based CVS boosted its presence in the US market after a $69bn merger with American rival Aetna 2018, creating a new healthcare powerhouse. The group provides a range of treatments and services including its own telehealth service. Like many large-cap stocks, CVS has seen the market go against it, but the group is rated as a large well-run business.

In terms of telehealth, the company has a direct program called MinuteClinic, and it also has exposure to the sector via Aetna. CVS Health currently has many buy and outperform ratings from the likes of JPMorgan Chase, Cowen, and Royal Bank of Canada.

SnapMD (Privately held)

Many telehealth companies that are privately held. SnapMD is owned by medical business VirTrial, which is in turn owned by New York-based private equity firm Kinderhook Industries. It specializes in connecting people with medical professionals in a virtual space and is forecast for growth in 2020.

Companies like SnapMD can’t be bought in public markets yet, but as the sector grows in popularity, they may go public. Keep an eye on these small telehealth companies, as they may be a great place to invest over the next decade.

Telehealth was already a hot sector before the coronavirus pandemic hit, but now companies like Teladoc stand out even further in what is a terrible market for bulls. Even as capital seeks safer investments, telehealth platforms and providers are likely to receive support from investors.

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    Adam Green is an experienced writer and fintech enthusiast. He he worked with LearnBonds.com since 2019 and covers a range of areas including: personal finance, savings, bonds and taxes.


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