ARK Crushed By Concentrated Bet In Teladoc

ARK Crushed By Concentrated Bet In Teladoc

Shares of the telemedicine provider were cut in half on Thursday, pressuring 'ARKK' and other ETFs.

Senior ETF Analyst
Reviewed by: Sumit Roy
Edited by: Sumit Roy

Shares of Teladoc (TDOC) crumbled on Thursday after the company reported dismal earnings for the first quarter. The 47% drop in shares of the telemedicine provider was a big blow for Cathie Wood’s ARK, which invested heavily in the stock. 

According to the latest data from the issuer’s website, the ARK Innovation ETF (ARKK) holds 6.8% of its portfolio in TDOC; the ARK Genomic Revolution ETF (ARKG) holds 7.5% of its portfolio in the stock; and the ARK Next Generation Internet ETF (ARKW) holds 5.7% of its portfolio in the name. Puzzlingly, even the ARK Fintech Innovation ETF (ARKF) has a 4.3% weighting in the name. 

Altogether, ARK owns 12% of Teladoc’s outstanding shares, according to Bloomberg.  

Adding To Its Losses  

The crash in TDOC couldn’t have come at a worse time for ARK. The issuer’s ETFs were already reeling from a yearlong bear market in high growth stocks. Just on Tuesday, the flagship ARKK hit a new two-year low. This morning, it’s down another 7%, bringing its peak-to-trough losses to more than 70%. ARK’s other funds have seen similar declines from their highs. 




At the Exchange ETF conference earlier this month, ARK’s Cathie Wood pushed back on the idea that stock concentration increases risk. 

“During risk-off periods, we always concentrate our portfolios towards our highest-conviction names. Most people assume that concentration increases risk; I don’t think that’s the case,” she said. 

In recent years, ARK had benefited tremendously from its big, bold bet on Tesla—a contrarian call that paid off in spades. The saga of Teladoc is the flip side of that and brings to light how dangerous stock concentration can be if things go wrong. 


Teladoc reported earnings in Q1 that missed on both the top and bottom line. The firm said that revenues grew 25% year over year to $565.4 million, below the $568.9 million that analysts were expecting. Earnings per share came in at -$41.58, well below the -$0.62 expected, though that was largely due to a write-down of assets related to its acquisition of Livongo in 2020. 

Perhaps most importantly, the company cut its outlook for sales in 2022 from a midpoint of $2.6 billion to $2.45 billion, citing increasing customer acquisition costs and elongated sales cycles—both, presumably, due to increasing competition. 

Analysts at Citi warned that the results “reveal cracks in TDOC’s whole health foundation as increased competitive intensity is weighing on growth and margins” and that they “are doubtful that we will see the competition-driven headwinds abate anytime soon.” 

Meanwhile, analysts at Piper Sandler were a bit more optimistic on the stock due to valuation. “There is a price for everything,” they said. TDOC currently trades at 2.2x this year’s sales, equal to its all-time low valuation from 2016. 


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Sumit Roy is the senior ETF analyst for, where he has worked for 13 years. He creates a variety of content for the platform, including news articles, analysis pieces, videos and podcasts.

Before joining, Sumit was the managing editor and commodities analyst for Hard Assets Investor. In those roles, he was responsible for most of the operations of HAI, a website dedicated to education about commodities investing.

Though he still closely follows the commodities beat, Sumit covers a much broader assortment of topics for, with a particular focus on stock and bond exchange-traded funds.

He is the host of’s Talk ETFs, a popular video series that features weekly interviews with thought leaders in the ETF industry. Sumit is also co-host of Exchange Traded Fridays,’s weekly podcast series.

He lives in the San Francisco Bay Area, where he enjoys climbing the city’s steep hills, playing chess and snowboarding in Lake Tahoe.