Here we go again. After a record recommendation started in 2019, the stock market is back in turmoil. Don't sweat the reasons, though – a breath was long delayed.
Meanwhile, there are some high-growing concerns out there that are worthy of your judgment. Three that our stupid contributors believe are worth your time are Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) Micron (NASDAQ: MU) and ] Teladoc (NYSE: TDOC) .
Google doesn't need your concern
Nicholas Rossolillo (Alphabet): In what becomes a quarterly trend, the stock market rose to new full-time levels just to be knocked down after reporting in the first quarter of 201
After a two-digit thumb-up, this high-growth network is a worthy appearance. It is true that sales increased by 17% during the first quarter, compared to an increase of 26% in the first quarter of 2018. However, some of the big difference was related to exchange rates. Google also referred to some changes in ad revenue recognition that had an impact and that Google is not at all concerned with quarterly variability.
Moreover, for a company that is the size of the alphabet, double-digit sales growth is no small business. Operating revenues also increased by 11%. The shares are now trading 29.3 times the current year's revenue value and only 24.4 times the next 12 months' expected earnings. It does not make stocks cheap, but one can do worse for a high-growing stock.
Nevertheless, the company continues to train money for its internal hardware business, YouTube, and a long list of startup programs, ranging from autonomous cars to healthcare computer science. Google doesn't go anywhere at any time, and has plenty of track to continue growing for many years to come.
A memorable money machine
Anders Bylund (Micron Technology): I understand if you are a little afraid of owning Micron right now. The memory chip manufacturer has seen chip prices weaken over the past year, causing sharp falls in company revenue and free cash flows:
So much for "it's different this time", right?
Right, except that this decline is really different. The last few fluctuations in DRAM and NAND memory prices are due to the Samsung flood market with an over-supply of cheap chips, driving weaker hands and reducing the cost of building everything from smartphones to home appliances home electronics. The Korean company may be the largest memory provider on the planet, but that operation is still only a minor sideline in Samsung's huge business.
This swing is really different. Prices are falling because Samsung and friends are selling fewer phones these days. There are several potential lifelines on the horizon, including a proliferation of things for the Internet of things and perhaps a fresh spark of smartphone interest when 5G networks (and devices capable of connecting them) begin to emerge in nature. But it is still in the future, and trade tensions between Beijing and Washington do not help this US company find new customers in the world's largest electronics manufacturing hub.
These issues will pass. Without the Chinese-American trade conflict, I'm not sure we would have seen a dip in Micron's revenue and cash profits at all – a smoothing, perhaps, but not a plunge.
On top of that, take a second look at the chart above. The long-term trend may be uneven, but it is undoubtedly positive. And we look at an absolute money machine. Micron converted $ 7.65 billion of its $ 30 billion on top-line free cash flow sales over the past four quarters, representing a cash margin of 26%. Does it sound like a company with deep problems for you?
It's not for me, but market makers disagree. Today, Micron shares are trading on the valuation of coupon purchases of 3.7 times subsequent earnings, or 5.8 times free cash flows. I think it's a big mistake. Expect this stock to come back to its winning long-term ways when the current turbulence disappears. Despite falling 39% from the 52-week high, Micron investors have received a 700% return over the past five years.
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Prior to this game changing shift is Teladoc. The company connects patients with doctors for various health problems, from chronic conditions to the flu. It even gives other opinions from specialists via telehealth solutions. Last quarter, virtual visits exceeded 1 million for the first time and grew 75% from one year ago. As a result, the company reported total revenue reached $ 129 million. Although you do not have visits and revenue growth from acquisitions, Teladoc reported ecological visits and revenue growth of 29% and 23%, respectively, in the past year.
About 82% of the revenue comes from third-party subscription fees, including insurance companies, healthcare, and self-insured companies. These customers pay a fixed amount so members can access virtual visits because they are significantly cheaper than traditional visitor visits. For example, a virtual visit is $ 472 less expensive than a visit to the office, according to Veracity Analytics, an independent data monitoring company for health care professionals. The remaining 18% of Teladoc's income comes from fees per visit.
Currently, Teladoc's solution is available to 27 million people through subscription access conditions, but it only scrapes the surface of this mega-opportunity. In addition to landing new accounts, management estimates that expanding existing relationships can provide access to another 50 million people. In addition, over 20 million Medicare Advantage members can access telehealth services as soon as 2020. Furthermore, the company expands to Europe, opening the door to a population of over 500 million.
Despite the tremendous opportunity, Teladoc's share price has fallen following a sales report that questions a reference market program for its mental health activity last year and the resignation of the CFO on claims for insider trading in December. However, the referral program represented only approx. 5% of their new mental health members, and finally a new CFO will be hired. Given the tremendous market opportunity and the robust top line growth, the latest stock divestment can make this great to add to this telehealth stock for growth portfolios.