$TDOC with ANOTHER giant goodwill impairment
This quarter it's $19 net loss per share or a $3 billion impairment charge for Livongo. What the actual fuck is this company at this point.
At this point.. are we even surprised? They overpaid for Livongo.
But this Q is better than the last one. Gross margin and adj gross margin % are up again (thank fuck)
Do we have any idea how sticky their current user base is? I imagine it's pretty difficult to get doctors onto the platform so how can we value this? ( unless doctors double dip by being on all platforms as a way to maximize their client base)
@pat_connolly If you look on Reddit there are some interesting threads where doctors discuss telemedicine opportunities. Seems a lot of doctors are doing this part time and there's a general sentiment I've picked up on that consistent telework is quite boring (basically writing out scripts for antibiotics all day) and that it's too easy for skills to start slipping working with such a limited scope.
They bought Livongo in late 2020 when valuations were very high and everyone was euphoric despite how bad those times were. This could be a sign that more of the acquisition deals that companies have made during those times will come with impairments as well.
A very simple balance sheet tactic to help avoid huge impairment potential, or generally low quality balance sheets.
If intangible assets & goodwill are a considerable portion of total assets, even worse if they are increasing as a % over time, just stay the hell away.