Earnings Previews: Palo Alto Networks, Range Resources, Teladoc, Virgin Galactic

Teladoc

Over the past 12 months, shares of Teladoc Health Inc. (NYSE: TDOC) have dropped by about 77%. However, if we start counting in January of 2020, the shares are down by about 21%. In mid-February of last year, the stock was up more than 240% compared to its level in January 2020. The pandemic and subsequent lockdowns drove Teladoc’s share price gains, and the recovery has now taken hold and pushed the stock price back down. The company needs to prove it has a key to the future.

Sentiment among analysts remains mostly bullish, with ratings of Buy or Strong Buy from 17 of 29 and the remaining dozen all with Hold ratings. At a share price of $65.00, the upside potential based on a median price target of $121 is 86.2%. At the high price target of $215, the upside potential is 231%.

Analysts expect Teladoc to post fourth-quarter revenue of $546.3 million, up 4.7% sequentially and 42.5% year over year. Teladoc is expected to report a loss per share of $0.54, worse than the $0.50 loss per share reported in the third quarter, but much better than the $3.07 loss per share in the year-ago quarter. For the full year, Teladoc is projected to lose $2.95 per share, down from $5.36 in 2020, on revenue of $2.03 billion, up 85.2%.

Teladoc is not expected to post a profit in 2021, 2022,or 2023. Shares currently trade at a sales to enterprise value multiple of 5.4 times $2.03 billion for 2021, 4.2 times $2.57 billion in 2022 and 3.4 times $3.18 billion for 2023. The stock’s 52-week range is $65.23 to $294.94. Teladoc does not pay a dividend. Total shareholder return for the past year was negative 77%.

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Virgin Galactic

For the past 12 months, shares of Virgin Galactic Holdings Inc. (NYSE: SPCE) have tumbled by 83%. The loss includes two spikes last year, one in mid-February that shot the price up by 150% and another in mid-May that added more than 260% to the share price. Alas, the price has been sinking pretty much steadily since then. Delays in space tourism flights until late this year have been costly for investors.

Chamath Palihapitiya, the board chair, stepped down last Friday to “focus on other existing and upcoming public board responsibilities.” The stock is a favorite of retail investors and trades an average of more than 35 million shares daily.

Analysts are mixed on the stock. Of 11 brokerages covering the shares, four have a Buy rating, four more give it a Hold rating and the others have a Sell or Strong Sell rating. At a share price of around $8.40, the upside potential based on a median price target of $20 is about 139%. At the high target of $36, the upside potential is around $330%.

Virgin Galactic is expected to report revenue of $440,000 for the fourth quarter, down about 83% sequentially. Analysts also expect a loss per share of $0.36, worse than the prior quarter loss of $0.19. For the full year, the company is expected to post a loss per share of $1.49, compared to last year’s loss of $1.25 per share, on sales of $3.39 million, up more than 1,300% year over year.

The company is not expected to post a profit in 2021, 2022 or 2023. For those three years, the stock’s enterprise value-to-sales multiple is 316.8 based on sales of $5.7 million in 2021, $7.82 million in 2022 and $41.13 million in 2023. The stock’s 52-week range is $7.58 to $57.51. Virgin Galactic does not pay a dividend. Total shareholder return for the past 12 months was negative 83%.