Overall, 2021 was a good year for investors. Despite the global epidemic և supply chain problems, S&P 500: It has grown by 28% since January, and the popular index is currently close to its all-time high. It is said that some Wall Street analysts still see great positive results for investors, especially in some rising stocks.

Barclays, for example, currently has a $ 345 price target Upstart Holdings: (NASDAQ: UPST), which implies an increase of 116%. And RBC Capital has a price target of $ 215 Teladoc Health: (NYSE: TDOC), which assumes a 130% upward. Of course, you should never make investment decisions based solely on the opinion of one analyst, but given the potential gains, it is worth looking into these two stocks in more detail.

Here’s what you need to know.

Image source: Getty Images.

1. Upstart Holdings:

Upstart is a fintech company that aims to improve consumer lending. Instead of relying on outdated credit models, Upstart uses artificial intelligence (AI) to measure default risk. In particular, the platform captures more than 1000 data points for each borrower և measures these variables relative to repayment cases. That way, its AI models improve every time the borrower pays or misses.

Significantly, internal studies have shown that the Upstart platform can reduce by default by 75%, while approval rates are stable. Alternatively, if loss rates remain unchanged, Upstart may increase confirmation rates by 173%. And that value proposition has turned into an incredible increase in sales.

Metric:

3 2020 (TTM)

3 2021 (TTM)

Change:

Income:

$ 213.9 million

$ 620.7 million

190%

Data source: YCharts. TTM = regression -12 months.

Last year, Upstart moved out of $ 81 billion in personal loans to $ 672 billion in auto loans. To accelerate this move, in April 2021, the company acquired Prodigy Software, an e-commerce platform that helps dealers find cars, loan applications, and consumer payments. The company rebranded the product as Upstart Auto Retail և it is already receiving a lot of attention. As of the third quarter, seven banks և 239 dealer companies were registered on the Upstart platform for car loans.

However, the market opportunities of the company can grow even more along the way. Management discussed entering the $ 4.5 trillion industry to enter the mortgage lending market. For the foreseeable future, Upstart has provided $ 8.9 billion in loans over the past 12 months, which is about 1% of its current market share շատ far less than 1% of its potential market share.

From that point of view, I would not be surprised to see a 115% jump in Upstart stock prices over the next 12 months. More importantly, this stock seems like a smart long-term investment.

2. Teladoc Health

Teladoc reinterprets healthcare. Its first virtual platform allows patients to meet clinics remotely, making the experience less costly and more convenient. To differentiate itself, Teladoc has aggressively invested in expanding its range of services, with its portfolio now covering 450 sub-disciplines, from general health to acute to chronic care.

Last year, Teladoc completed the acquisition of Livongo, an artificial intelligence-based healthcare platform to improve outcomes for chronic diseases such as diabetes, hypertension and weight management. The move not only expanded Teladoc’s portfolio, but also created a potential source of synergy, as acute care physicians can now direct patients directly to chronic care programs.

Overall, Teladoc is the most comprehensive telemedicine solution on the market, and from a financial standpoint it has become a strong revenue stream.

Metric:

3 2020 (TTM)

3 2021 (TTM)

Change:

Income:

$ 867.1 million

$ 1.9 billion

115%

Data source: YCharts. TTM = regression -12 months.

Unfortunately, Teladoc’s membership growth has slowed significantly due to the epidemic. Paid US membership grew by only 2% in the last quarter to 52.5 million. Investors need to look closely at this indicator. A certain slowdown is natural, but if Teladoc fails to accelerate membership growth again, the company may have problems.

In other words, the leadership is taking smart steps. In October, Teladoc launched Primary360, a virtual first-line primary care solution that combines patients with a dedicated physician. This service enhances the synergies created by Teladoc’s extensive portfolio by adding a touch point where physicians can refer patients to chronic care programs or specialists such as mental health professionals.

To that end, Teladoc launched myStrength Complete in its second quarter, a mental health service that includes clinicians, in-app tools to help patients manage stress, depression, and other mental health conditions. It is remarkable. Teladoc has seen a promising increase in its chronic care programs, with the number of registered patients increasing by 31% to 725,000 in the last quarter, and the number of patients included in more than one chronic care program has tripled.

Given all the circumstances, it is not difficult to imagine that Teladoc’s share price will increase by 130% in the next 12 months, especially if the company is able to accept new members faster.

This article presents the opinion of a writer who may disagree with the position of the “official” recommendations of Motley Fool Premium Consulting. We are motley! Questioning an investment thesis, even our own, helps all of us think critically about investing, making decisions that help us become smarter, happier, and richer.