Virtual care has been on the rise in the United States for some time now. However, the restrictions imposed by the COVID-19 pandemic have catalyzed the adoption of telehealth services in the country.
The numerous benefits of telehealth included expanding access to care, reducing disease exposure for staff and patients, preserving scarce supplies of personal protective equipment, and reducing patient demand on facilities.
According to the CDC, this resulted in a 154% increase in telehealth visits during the last week of March 2020, compared with the same period in 2019.
Barring the occasional spikes in infection from virus variants that seem to have become endemic, the U.S. and global economy has, by and large, put Covid 19 in its rearview mirror.
However, even as the tailwind of the pandemic has all but faded away, continued uptake, favorable consumer perception, and tangible investment into this space are all contributing to the continued growth of telehealth.
According to a Harvard Business Review report, increasing the frequency and scope of virtual care nationwide would transform American health, improving the lives of patients who get sick during nights and weekends, those with chronic conditions, and those who live in rural areas.
With telehealth arriving as a new reality for healthcare enterprises with innovations around virtual longitudinal care (both primary and specialty), remote patient monitoring, and self-diagnostics set to turbocharge the accessibility, scalability, and reach of healthcare, here are three businesses well-positioned to capitalize on this rising tide.
CVS operates as a health solutions company. The company operates through four segments: Health Care Benefits; Health Services; Pharmacy & Consumer Wellness; and Corporate/Other. Its Health Services segment provides a full spectrum of pharmacy benefit management solutions, delivers health care services in its medical clinics, virtually and in the home, and offers provider enablement solutions.
Over the past three years, CVS’ revenue has grown at an 8.1% CAGR, while its EBITDA has grown at 4.5% CAGR. During the fiscal first quarter that ended March 31, 2022, CVS’ total revenues increased 11% year-over-year to $85.28 billion.
With the aim to advance its value-based care strategy, CVS completed its acquisition of Signify Health and Oak Street Health on March 29 and May 2 of this year, respectively.
DOCS provides a cloud-based platform for medical professionals in the United States. The platform helps its members collaborate with colleagues, coordinate patient care, conduct virtual patient visits, stay up-to-date with medical news and research, and manage careers.
DOCS’ topline has grown at a phenomenal 58.9% CAGR over the past three years. During the fiscal third quarter that ended December 31, 2022, its revenue increased 18% year-over-year to $115.3 million.
Ahead of its earnings release on May 16, analysts expect DOCS’ revenue for the fourth quarter and fiscal year that ended March 31, 2022, to increase by 17.6% and 21.7% year-over-year to $110.09 million and $418.16 million, respectively.
TDOC operates in the health services segment and provides virtual access to care. The company’s portfolio of services and solutions includes various medical subspecialties, from non-urgent, episodic needs to chronic, complicated medical conditions.
Over the past three years, TDOC’s revenue has grown at a 59.8% CAGR, while its total assets have grown at a 39% CAGR over the same time horizon. During the fiscal first quarter that ended March 31, 2023, TDOC’s revenue increased by 11% year-over-year to $629,2 million.
For the fiscal second quarter, analysts expect TDOC’s revenue to increase 9.5% year-over-year to $648.78 million and its loss per share to narrow by 1.2%. For fiscal 2023, the company’s revenue is expected to increase by 9% over the previous year to $2.62 billion.
