Credit Suisse Cuts Estimates on SmileDirectClub Inc. (SDC)

Credit Suisse analyst Erin Wilson Wright reiterated an Outperform rating and $13.00 price target on SmileDirectClub Inc. (NASDAQ: SDC) while slightly reducing 2021 EPS to -$0.35 (from -$0.33), and 2022 EPS to -$0.16 (from -$0.14).

The analyst stated that the "go-to-market strategy has evolved meaningfully, targeting a more controlled growth story, including +20-30% revenue growth annually (+5-7% sequential quarterly growth), where SDC is focused on maintaining high customer service levels and tight turnaround times. This updated strategy was a notable evolution relative to its IPO messaging, where SDC previously aimed to capture as much volume as possible, albeit with certain operational missteps and litigation noise pressuring consumers’ (as well as investors’) perspectives on the aligner company. To better reflect its more measured growth strategy, despite an easy 2020 comp (est. -13.1% sales growth), we are reducing our 2021 sales growth estimate to +28.0% (vs. prior +31.9%). We are also lowering 2021 profit expectations on ramping sales & marketing spend".

For an analyst ratings summary and ratings history on SmileDirectClub Inc. click here. For more ratings news on SmileDirectClub Inc. click here.

Shares of SmileDirectClub Inc. closed at $12.65 yesterday.

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