Cathie Wood’s ARK ETFs load up on Teladoc after the stock dips following Amazon threat

Cathie Wood
Cathie Wood is the founder, CEO, and CIO of ARK Investment Management.

Three of Cathie Wood’s ARK Invest ETFs loaded up on 305,457 shares of Teladoc on Wednesday following a sharp fall in the share price.

Specifically, the ARK Innovation ETF added 174,957 shares, while ARK Genomic Revolution ETF and the ARK Next Generation Internet ETF added 78,371 and 52,148 shares, respectively.

Teladoc is now the largest holding in the ARK Genomic Revolution ETF and is tied for the third-largest holding in the ARK Innovation ETF with Roku.

As of market close on March 17, the combined shares bought by Wood’s ETFs were worth approximately $58 million.

Teladoc has been under pressure of late after Amazon announced it’s launching a rival telehealth business called Amazon Care. The service had previously only been available to Amazon employees in the state of Washington.

Now, as Insider reported back in December, Amazon Care is undertaking a national expansion with the goal of serving workers at other major companies in all 50 states.

Teladoc stock fell nearly 8% in a gap down move before Wednesday’s opening after the Amazon Care expansion was confirmed, perhaps signaling to Wood and co. that time was right for a buy.

Shares of the multinational telemedicine and virtual healthcare company have fallen over 36% from mid-February highs. While some investors fear Teladoc may have more downside ahead of it, many experts argue Amazon won’t be able to take over from the Harrison, New York-based firm so easily.

David Larsen, CFA, a managing director at BTIG, told Bloomberg, “the threat is overstated because Teladoc and American Well have contracts with many of the large health plans. Amazon has been very successful in taking market share from your traditional retail storefronts in many areas. But health care is different.”

Teladoc traded down 3% as of 3:49 p.m. ET on Thursday.

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Teladoc drops on report that Amazon is building a business to offer primary care for other companies

FILE PHOTO: Amazon founder and CEO Jeff Bezos laughs as he talks to the media while touring the new Amazon Spheres during the grand opening at Amazon's Seattle headquarters in Seattle, Washington, U.S., January 29, 2018.   REUTERS/Lindsey Wasson/File Photo
Amazon founder and CEO Jeff Bezos.

  • Teladoc fell 6% on Wednesday following a Business Insider report that Amazon is quietly building a business to offer primary healthcare services for other large employers.
  • As an extension of Amazon Care, the service would offer in-person and online doctor visits that can be scheduled through a mobile app, according to the report.
  • Shares of health insurance stocks also fell, with UnitedHealth Group and Cigna dropping as much as 2%.
  • Visit Business Insider’s homepage for more stories.

Shares of Teladoc and health insurance providers fell on Tuesday following a report from Business Insider that Amazon is quietly building a healthcare service that will be offered to employee of other large companies.

As an extension of Amazon Care, the service would offer in-person and online doctor visits that can be scheduled through a mobile app, according to the report. The service would bypass health insurance plans and brokers, potentially helping lower the cost of healthcare.

Citing people familiar with the matter, Business Insider reports that Amazon has already pitched the service to Zillow, though its unclear how many other companies were pitched the service offering. 

Zillow confirmed that it was pitched the Amazon Care service but that nothing came of it, according to the report. 

Read more: Amazon is going deeper into the prescription-drug business. Here are the 7 ways the tech giant is taking on healthcare, and why 2 analysts think doctor visits are next.

Amazon’s push into healthcare services has been years in the making, most recently marked by the e-commerce giant’s launch of an online pharmacy. That move sent pharmacy stocks like CVS and Walgreens down substantially.

A similar move played out on Wednesday in shares of Teladoc, which helps facilitate virtual doctor visits for patients via video-calls. Shares of Teladoc fell as much as 6% in Wednesday trades.

Health insurance stocks also fell on Wednesday following the report, with shares of both UnitedHealth Group and Cigna down as much as 2%. Shares of Amazon traded up nearly 1% in Wednesday trades.

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