Increased website visits are a boon for online businesses. Investors look for website trends to analyze how much demand the company’s online services are pulling. Therefore, it is worth highlighting the strong website footfall we noticed in telehealth firm Talkspace (TALK) during Q2, ahead of its earnings release after the market closes on August 8.
Before that, let us understand what Talkspace does.
What Is the Talkspace Company?
Talkspace is a unique virtual platform that was created to focus on providing solutions related to mental and behavioral health. The company’s offerings encompass everything from marriage counseling to psychotherapy.
The emergence of Covid-19 brought a fresh momentum in the demand for psychotherapy and other mental health-related services, and Talkspace was thrust to the limelight. Moreover, the platform attracted more traffic when Cigna (CI) added Talkspace’s virtual therapy services to its own telehealth offerings.
The company went public last June through a SPAC deal, but it has since been bogged down by melting share prices. Notably, its shares have lost 74% since it hit the stock exchange.
Competitive pressures and plummeting profitability are its biggest concerns due to various reasons.
However, looking at things from another perspective, the company is expected to report a narrower loss per share than previously expected in Q2. Recently, SVB Leerink analyst Stephanie Davis raised her estimates from a loss of $0.14 per share to a loss of $0.13 per share.
While there are various fundamental trends that pushed the estimate up, we will highlight the interesting website trends here. We believe these trends have played a key role in the company’s Q2 performance.
Interesting Website Trends
TipRanks’ tool which tracks and analyses a company’s website traffic, showed us that virtual visits to Talkspace’s platform from all over the world increased 13.79% from the first quarter of this year. Moreover, the year-over-year stats were also encouraging, reflecting a 13.02% growth.
Though this does not reflect a particularly happy society, it definitely is good news for the company. More visits to their platform mean more chances of the visits converting into service requests, and hence, better revenues.
In the Q1 earnings presentation, interim CEO Douglas Braunstein had said, “We have what I would suggest is a reasonably robust pipeline of potential customers to add to our DTE business coming into Q2.” This somewhat conforms with our findings, as this may have a part hand in driving website traffic.
Moreover, management had also given us a picture of how they are focusing on enhancing the experience of a customer on the company website, which also gives us a possibility behind the surge in website visits in Q2.
Braunstein had mentioned that the company is making “other adjustments and additions to how customers experience their journey through our website, and then are connected with therapists and the retention associated with that.”
Is TALK Stock a Good Buy?
Wall Street’s conviction doesn’t look too inspiring, with an overall Hold rating based on two unanimous Hold ratings. The average price target of $1.75 also indicates an 8.85% downside risk.
Analysts appear to wait in the sidelines for better insights into the company and more meaningful developments before they improve their ratings.
Parting Thoughts
At this point, after suffering from various setbacks, it seems the impressive trends in website visits come as welcome news for Talkspace. It should be noted that though the company could not generate profits in the last year, revenue growth has always been a strong point and has helped the company stay afloat. Strong trends in website traffic indicate that the company is likely to have continued the revenue growth momentum in Q2 as well.
