Below we presented the list of the 5 best telemedicine stocks to buy now. For our detailed discussion and a more comprehensive list please see 12 Best Telemedicine Stocks to Buy Now.
5. Nuance Communications, Inc. (NASDAQ:NUAN)
No of HFs: 45
Total Value of HF Holdings: $3.05 Billion
Nuance Communications, Inc. ranks as the fifth-best telemedicine stock to buy now. They are one of the most popular companies when it comes to conversational AI innovations. Recently, the company launched the Dragon Ambient eXperience for Telehealth. It is a solution that revolutionized the physician-patient experience by securely capturing conversations and automatically create clinical notes.
In an article, RGA Investment Advisors, LLC highlighted a few stocks and NUAN was one of them.
“Early in the first quarter, we made a new investment in Nuance Communications. Nuance provides conversational artificial intelligence to healthcare (two thirds of revenue) and enterprise end markets. Within healthcare, in addition to owning a functional monopoly in radiology documentation with PowerScribe, the company has a strong suite of products powering the digitization of the industry. Nuance is best known for its Dragon medical dictation product, used by 55% of doctors in the United States. 11 They are currently transitioning Dragon medical dictation into a high margin, recurring revenue, cloudbased product called Dragon Medical One. Dragon Medical One grew revenue 54% last quarter, showing clear progress in the transformation.
4. Teladoc Health, Inc. (NYSE:TDOC)
No of HFs: 47
Total Value of HF Holdings: $997 Million
Teladoc Health, Inc. is multinational telemedicine and virtual healthcare company that provides virtual medical care. Including general medicine, mental health, dermatology, nutrition, and alike.
Baron Discovery mentioned in an article that Teladoc Health, Inc. was one of their most successful investment ever.
“We sold our remaining investment in Teladoc Health, Inc., one of our most successful investments ever. Our view was that the company’s valuation felt a bit extended, and its market capitalization at over $19 billion was too large for the Fund to hold. Moreover, we believe that, on a pro-forma basis, the market cap will be around $40 billion after its recent bid to merge with Livongo Health, Inc., a transaction expected to be completed in the fourth quarter. We hold Teladoc’s management in the highest regard and admire the incredible company it has built over the last few years.”
3. Change Healthcare, Inc. (NASDAQ:CHNG)
No of HFs: 49
Total Value of HF Holdings: $1.36 Billion
Change Healthcare, Inc. ranks as the third-best telemedicine stock to buy now. The company offers a catalyst for value-based healthcare systems. During the fiscal 2020 fourth quarter, the company reported total revenue of $843.4 million. An insider recently purchased 100,000 shares at around $12. The stock increased by 50% since then.
In an article, Greenlight Capital Fund mentioned their comments on the stock.
“We initiated a large long position in Change Healthcare (CHNG). CHNG is a healthcare technology company that owns the largest medical claims clearinghouse network and several leading software platforms. For years, we were short athenahealth, which promoted itself as the “backbone of the healthcare internet.” That label is more aptly applied to CHNG.
While similar healthcare assets trade for over 20x free cash flow, we were able to acquire our stake in CHNG for $11.40, or 9x our estimated free cash flow. Until recently, McKesson’s large retained ownership of the company rendered the stock less liquid, with an available float of under $1 billion and less than one quarter of all outstanding shares. We believe this limited investor interest in the new company. In February, McKesson announced an exchange offer that increased CHNG’s public float by more than 3x, making the company investable to a much broader range of potential shareholders.
The company has not shown meaningful top-line growth recently. We believe growth in the company’s core businesses has been obfuscated by several one-time factors including planned contract eliminations, the rollout of a new imaging platform, and the shift to ASC 606 accounting standards. With these events now behind the company, we expect solid growth in the coming years with the resumption of elective surgeries. CHNG shares ended the quarter at $9.99.
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2. Laboratory Corporation (NYSE:LH)
No of HFs: 57
Total Value of HF Holdings: $1.74 Billion
Laboratory CP is included in Billionaire Larry Robbins’ Top 10 Stock Picks. The company offers clinical laboratory tests that are used for routine testing. Labcorp came up with the telemedicine toolkit to provide access to virtual healthcare resources via a virtually supported manner. An insider recently purchased 330 shares at around $168. The stock is up 23% since then.
The top hedge fund holder of this stock is Gabriel Plotkin’s Melvin Capital Management which had $306 million invested in the stock at the end of September.
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1. Dexcom, Inc. (NASDAQ:DXCM)
No of HFs: 58
Total Value of HF Holdings: $1.51 Billion
The top one best telemedicine stock to buy now is Dexcom, Inc. They are also ranked in the 12 Best Fitness Stocks to Buy Now. Their telemedicine platform, Clarity is the number one preferred tool to support effective diabetes management. The platform allows you to analyze and reference patients’ glucose patterns during in-person or telehealth consultations.
Is DexCom likely to remain resilient from the COVID-19 impact? In an article, we mentioned Brown Advisory’s words on DXCM,
“The right words to describe DexCom’s attractive performance are hard to find. Despite an expanded approval of Abbott’s competing glucose monitoring device, the stock has remained resilient.”
Please also see 12 Best Large Biotech Stocks to Buy Now and 10 Best Defense Stocks To Buy for 2021.
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