Chase Coleman (Trades, Portfolio) made an investment in the center of his competence last Tuesday, buying 9.03% of healthcare-via-phone company Teladoc Inc. (TDOC, Financial).
Coleman’s hedge fund Tiger Global Management bought 4,898,792 shares of the company at an average price of $21.15 per share, for a total investment of $103.6 million. Teladoc’s share price has declined 16.8% from its July IPO price of $28 but is up 41.2% year to date, to $23.30 at close Monday.
Along with several other prominent managers, Coleman learned his trade from Julian Robertson (Trades, Portfolio), an early adopter of the long-short hedge fund model. But early on Coleman gave it his own slant by embracing up-and-coming technologies or internet concepts, like Facebook (FB, Financial) and Amazon (AMZN, Financial). His $8.03 billion equity portfolio is populated by names like Etsy (ETSY, Financial), The Priceline Group (PCLN, Financial), NetEase Inc. (NTES, Financial) and Fitbit Inc. (FIT, Financial).
Teladoc falls into the same category. The company allows clients to talk to a doctor or get a prescription through phone, videoconferencing or mobile app, about issues ranging from dermatology to mental health, for a monthly subscription fee.
More than 17 million members were using the Lewisville, Texas-based company as of its March 1 report, an increase of 43%, as total visits jumped 68% from the comparable quarter last year to 31,467. Revenue also grew 59% to $123.2 million for the year ended Dec. 31, 2016, slowed from the 78% increase from 2014 to 2015.
Earnings stumbled, however, with a net loss of 31 cents per share, compared to 39 cents per share in the comparable quarter last year. Net losses totaled $74.2 million, or $1.75 per share, for the year, compared to $58 million in losses, or $2.91 in 2015 as expenses mounted. From 2014 to 2015, advertising, legal regulatory and acquisition related costs grew faster than the rate of revenue, and have continued to grow along with new members and revenue into 2016.
For the full year 2017, Teladoc has projected increased revenue in the range of $180 million to $185 million, and membership in the range of 21.5 million to 23.0 million. It expects to continue its net losses, predicting a range between 85 cents per share and 91 cents per share.
See Chase Coleman (Trades, Portfolio)’s portfolio here.
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