Home IPO SmileDirectClub Falls After UBS Downgrade, Price-Target Cut

SmileDirectClub Falls After UBS Downgrade, Price-Target Cut

by TradingETFs.com

SmileDirectClub (SDC) – Get Report were lower after a UBS analyst downgraded the teledentistry platform to neutral from buy and halved his price target.

Analyst Kevin Caliendo cut his price target on the Nashville company to $9 from $18. The company, which provides patients with teeth aligners, went public in 2019 at $23.

In a note to investors Caliendo said the company’s economic model and high customer-acquisition cost don’t suggest a clear path to profitability.

“We view management’s renewed focus on profitability and customer quality as necessary steps,” he said, “but … there is more pressure on management to execute, as investors will not reward growth at the expense of margin given the financial performance of the company since its IPO.”

The analyst also cited “execution concerns” evident in the company’s fourth-quarter-earnings miss.

Last week, the shares took a hit after the company missed Wall Street’s fourth-quarter expectations, while analysts slashed their price targets. 

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