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Teladoc Health, Inc. (NYSE:TDOC), a leader in virtual healthcare services, announced the resignation of its Chief Operating Officer, Michael Waters (NYSE:WAT), effective as of the close of business on December 31, 2024. The departure comes following a change in the company's executive reporting structure.
Waters, who has served as COO, decided to resign with good reason under his executive employment agreement due to modifications in the company's leadership hierarchy. Teladoc has expressed gratitude for Waters' contributions during his tenure.
Under the terms of the resignation agreement, Waters will receive a severance package that includes nine months of continued base salary and COBRA healthcare coverage premiums.
Additionally, he will be entitled to any earned but unpaid annual bonus for 2024 and will benefit from the accelerated vesting of time-based equity awards scheduled to vest within nine months post-separation. Waters will also remain eligible for performance-based equity awards, should the pertinent performance conditions be met within that timeframe.
The agreement further stipulates that Waters will stay on as an employee through the end of the year and will sign a separation and release agreement, which includes a release of claims in favor of the company. Post-termination, he is expected to adhere to non-compete and non-solicit obligations for a period of nine months.
In other recent news, Teladoc Health Inc. has experienced a series of adjustments in its share price targets by various firms such as Jefferies, Deutsche Bank, and Piper Sandler, following its second-quarter earnings report. Despite surpassing adjusted EBITDA expectations, Teladoc anticipates potential contraction in its BetterHelp segment, attributed to rising customer acquisition costs. Jefferies, for instance, increased Teladoc's price target to $10.00 while maintaining a Buy rating, noting BetterHelp's return to growth in web traffic.
Teladoc recently appointed Joseph Catapano as its new Senior Vice President and Chief Accounting Officer. Catapano, who previously served as the Vice President and Chief Accounting Officer of Pitney Bowes Inc (NYSE:PBI)., brings a wealth of experience to his new role.
New CEO, Chuck Divita, is actively addressing these issues, hinting at potential reorganization or divestiture of the behavioral segment. Analyst firms such as Piper Sandler, TD Cowen, and Barclays continue to view Teladoc's stock favorably, indicating an expectation of future outperformance. However, firms like Jefferies, Deutsche Bank, and Citi have maintained a neutral stance due to challenges in the BetterHelp segment. These are among the recent developments for Teladoc as the company navigates its current challenges and growth phase.
InvestingPro Insights
As Teladoc Health, Inc. (NYSE:TDOC) navigates this leadership transition, recent InvestingPro data provides additional context for investors. The company's market capitalization stands at $1.52 billion, reflecting its significant presence in the virtual healthcare sector. Despite a strong 28.03% price return over the past month, Teladoc's year-to-date performance shows a 57.4% decline, indicating a challenging year for the stock.
InvestingPro Tips highlight that Teladoc's valuation implies a strong free cash flow yield, which could be a positive sign for investors looking at the company's financial health amidst these changes. However, it's worth noting that analysts do not anticipate the company will be profitable this year, aligning with the reported operating loss of $214.68 million in the last twelve months.
For those seeking a deeper understanding of Teladoc's financial position, InvestingPro offers 8 additional tips that could provide valuable insights into the company's prospects following this executive reshuffle.
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