Why Has SmileDirectClub’s Stock Tanked Since Its IPO in September 2019?

by Trefis Team
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SmileDirectClub (NYSE:SDC) is a tele-dentistry company that provides proprietary dental straightening solutions through its ‘Aligners’ range of products. The company’s market capitalization has shrunk by roughly 60% since its debut on the bourses in Sep 2019 as it faces regulatory challenges to its business on multiple fronts. The American Dental Association has complained to the USFDA, FTC and other agencies alleging that SmileDirectClub has been making false and misleading statements to lure customers. Further, the short seller Hindenburg Research released a report questioning some accounting practices followed by the company with respect to transactions with promoters. Both these issues triggered a selloff in the company’s stock – sending its share price down from a peak level of $21 immediately after its IPO to around $8 now.

We step back from these recent swings to review SmileDirectClub’s performance over the last few years, as a context for what might come next. Our Interactive dashboard – Why SmileDirectClub’s (SDC) Stock Fallen Off A Cliff Since Its IPO?, reviews the near term reasons and the big picture.

 

A closer look At SmileDirectClub’s Total Revenues over the last few years and the outlook

Total Revenues for SmileDirectClub jumped from $146 Mil in 2017 to $423.2 Mil in 2018; an increase of 178.6%. We expect Total Revenues to grow by 76.3% to $753.9 Mil in 2019.

 

A closer look At SmileDirectClub’s Total Expenses over the last few years and the outlook.

Total Expense for SmileDirectClub substantially increased from $178.6 Mil in 2017 to $497.6 Mil in 2018. We expect Total Expense to grow to $877.1 Mil in 2019.

 

How does SmileDirectClub’s Revenue Growth compare with rivals?

For more information on how SmileDirectClub’s revenue growth compares with Health Catalyst, InMode and Progyny, view our interactive dashboard analysis.

 

How has  SmileDirectClub’s  LBT trended?

LBT for SmileDirectClub increased substantially by 127.9% from $32.6 Mil in 2017 to $74.4 Mil in 2018. We expect LBT to be $123.3 Mil in 2019.

 

How has SmileDirectClub’s Net Income and EPS trended?

For more details about SmileDirectClub’s Net Income and EPS, view our interactive dashboard analysis.

 

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