Health services company Teladoc Health (TDOC) has declined nearly 70% in the past year. One trader sees shares trending significantly higher over the next 10 months.
That’s based on the June 2025 $17.50 calls. With 302 days until expiration, 7,639 contracts traded compared to a prior open interest of 124, for a 62-fold rise in volume on the trade. The buyer of the calls paid $0.27 to make the massively bullish bet.
Teladoc shares recently traded for about $7.20. Shares would need to rise by over $10, or 143%, for the option to move in-the-money. Shares are right near their 52-week low of $6.77.
The collapse in Teladoc shares reflects the company’s deteriorating fundamentals. While revenues declined by just 2% over the past year, the company lost nearly $6 per share, or just over $1 billion.
At current prices, shares have a -38% profit margin. On the plus side, the company trades at a significant discount to its sales, and there is nearly $1.2 billion in cash on the books to keep things running.
Action to take: Shares do look oversold following their slide. And they could easily pop on some good earnings reports or positive news. However, at best, that makes for a speculative bet on shares.
For traders, the calls have plenty of time to play out and are incredibly inexpensive. Any bump higher in shares could translate into triple-digit returns at a low cost, which makes for a more attractive risk/reward payout compared to buying shares.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.