Luca Capital, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. A quarterly net gain of 27.7% was delivered by the fund for the third quarter of 2021, and this compares to the overall increase, including dividends, for the Nasdaq 100 and S&P 500 of 13.2% and 8.9%, respectively. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.
Luca Capital, in its Q3 2021 investor letter, mentioned Teladoc Health, Inc. (NYSE: TDOC) and discussed its stance on the firm. Teladoc Health, Inc. is a Harrison, New York-based multinational telemedicine and virtual healthcare company with a $17 billion market capitalization. TDOC delivered a -46.78% return since the beginning of the year, while its 12-month returns are down by -46.47%. The stock closed at $106.41 per share on November 29, 2021.
Here is what Luca Capital has to say about Teladoc Health, Inc. in its Q3 2021 investor letter:
“As bullish as we are on the future of telemedicine though, we acquiesce that it can be difficult to build a durable moat. Although telemedicine is very scalable and an easy sell (everyone is a potential customer), the service itself is a commodity with little pricing power and low switching costs. However, scale is a significant advantage as a larger network of providers confers lower connection times and wider coverage. In addition, different areas of the country have varying access to care at any given time, but since regulations now allow providers to see patients across all states, we can better match doctors with patients under a national network, similar to “load balancing” in computing. Since Teladoc is international too, there also exists an opportunity to see patients across international borders. These are just a handful of reasons why we do not believe off-the-shelf consumer products like Zoom or Twilio will eventually replace the core telemedicine providers. They’re not integrated, not on-demand, limited to local physician supply, not accessible at the point-of-care via carts or other hospital equipment, and there’s nothing like Livongo to give the providers a continuous picture of patient health. Teladoc also allows whitelabelling, which enables health systems to take advantage of Teladoc’s additional provider supply while retaining the brand their patients have come to know and trust. However, while this incentivizes health systems to go with specialized platforms like Teladoc or Amwell, it’s making it more difficult for end-consumers to differentiate the major telemedicine providers at the product-level.”
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Based on our calculations, Teladoc Health, Inc. (NYSE: TDOC) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. TDOC was in 40 hedge fund portfolios at the end of the third quarter of 2021, compared to 43 funds in the previous quarter. Teladoc Health, Inc. (NYSE: TDOC) delivered a -26.26% return in the past 3 months.
Disclosure: None. This article is originally published at Insider Monkey.
