Why SmileDirectClub Shares Are Tumbling Today

SmileDirectClub Inc SDC is trading significantly lower after the company reported worse-than-expected third-quarter financial results and issued guidance below estimates.

SmileDirectClub reported a quarterly loss of 23 cents per share, which came in below the estimate for a loss of 13 cents per share. The company reported quarterly revenue of $137.68 million, which came in below the estimate of $181.9 million.

SmileDirectClub expects fourth-quarter revenue to be in a range of $120 million to $140 million versus the estimate of $201.8 million.

"We are disappointed with our third quarter results driven by the macroeconomic headwinds that are influencing the spending of our core demographic," said David Katzman, chairman and CEO of SmileDirectClub.

Katzman continued, "While we could not have anticipated the rapidly evolving nature of this impact on our consumer, we have responded quickly to focus our marketing on helping support them during this time, while we also move upstream with higher income demographics through the Challenger Campaign and investments in our Dental Partner Network."

Related Link: SmileDirectClub Stock Plunges As Q3 Earnings Lag Street Forecasts, FY21 Outlook Cut

• Craig-Hallum analyst Alexander Nowak downgraded SmileDirectClub from Hold to Sell and lowered the price target from $8 to $3.

SmileDirectClub is engaged in the sale of aligners, impression kits, whitening gel and retainers.

SDC Price Action: SmileDirectClub has traded as high as $16.07 and as low as $4.63 over a 52-week period.

The stock was down 23.20% at $4.03 at time of publication.

Photo: courtesy of SmileDirectClub.