Teladoc rises after sudden CEO departure; some analysts cheer

Teladoc Health

05/04/2024 18:00

(Updates, adds analyst commentary)
    ** Teladoc Health's  TDOC.N  shares up 2.9% at $14.67 on Fri
after virtual healthcare provider said long-time CEO leaving the
firm
    ** Co early Fri announced Jason Gorevic, CEO of 15 years,
departing firm, effective immediately, and that board appointed
CFO Mala Murthy as acting CEO while it seeks permanent
replacement
    ** Teladoc, which did not disclose reasons for Gorevic's
departure, reiterated Q1 and FY 2024 guidance
    ** KeyBanc analyst Scott Schoenhaus ("sector weight" rating)
said management shakeup could be viewed as potential positive
catalyst "given the recent execution challenges"
    ** Schoenhaus added new permanent CEO could shift focus from
online mental health platform, BetterHelp, to co's core
integrated care platform and chronic care offering
    ** Jefferies analyst Glen Santangelo ("hold", $16 PT) said
"a fresh set of eyes on the strategy and strategic options could
be a potential positive"
    ** TD Cowen analyst Charles Rhyee ("hold", $16 PT), said he
is not surprised by board's decision, adding the announcement
"could likely be taken well by investors, as it signals the
company could consider changing directions away from a strategy
that has negatively impacted shares over the last few years"
    ** TDOC's stock slumped 24% on Feb 21 after co's downbeat
2024 sales forecast on sluggish demand for BetterHelp business
    ** Even with move on Fri, stock has lost more than 30% YTD
after hitting nearly 8-yr lows earlier this week

 (Lance Tupper is a Reuters market analyst. The views expressed
are his own)
 ((lance.tupper@thomsonreuters.com
lance.tupper@tr.com 1-646-279-6380))