Why Teladoc Inc. Stock Fell Monday

MarketsMotley Fool

What happened

High expectations come at a cost, and Teladoc (NYSE: TDOC) investors are feeling that cost today. Shares of the on-demand virtual appointment health platform fell as much as 10.3% on Monday after the company provided a worse-than-expected outlook for its revenue growth in fiscal year 2018.

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Teladoc guided for a strong 52% year-over-year increase in 2018 revenue. But analysts wanted more.

So what

In an update on Monday, Teladoc provided preliminary unaudited results for its fourth quarter of 2017, as well as its preliminary financial outlook for fiscal year 2018.

For its fourth quarter, Teladoc said revenue was $76 million, up 103% compared to the year-ago quarter. This is about in line with what analysts were expecting for the period. But guidance for 2018 revenue of $350 million to $360 million (up 52% based on the midpoint of this range) was below the consensus analyst estimate for the period. On average, analysts expected 2018 revenue of $364 million, or year-over-year growth of about 57%.

Now what

Teladoc management was bullish on the company's underlying execution, noting that 2017 was a "landmark year as we redefined the virtual care delivery landscape with our acquisition of Best Doctors."

Investors should look for Teladoc to meet or exceed its guidance for fiscal year 2018 in order to live up to its valuation. Management said it is building on its "strong momentum in all segments of the Teladoc business."

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Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool recommends Teladoc. The Motley Fool has a disclosure policy.