It has been about a month since the last earnings report for SmileDirectClub . Shares have added about 43.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is SmileDirectClub due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
SmileDirectClub Q4 Earnings Lag Estimates, Margin Falls
SmileDirectClub, Inc. reported a loss of 25 cents for fourth-quarter 2021, wider than the year-ago loss of 9 cents. However, the figure was narrower than the Zacks Consensus Estimate of a loss of 28 cents.
Full-year loss of 87 cents per share was much wider than the loss of 72 cents. The metric was also wider than the Zacks Consensus Estimate of a loss of 82 cents.
Revenues
Revenues in the fourth quarter totaled $126.3 million, lagging the Zacks Consensus Estimate by 1.9%. The top line declined 31.6% from the year-ago number. The company shipped roughly 66,133 unique aligner orders, down 5.4% sequentially. The quarter’s average aligner gross sales price (ASP) came in at $1,899, down 4.6% on a sequential basis.
Net revenues (related to retainers, whitening, and other ancillary products) came in at $116.5 million, down 32.5% from the year-ago quarter. Financing revenues (interest associated with SmilePay program) in the reported quarter were $9.8 million, down 18.4% from the year-ago quarter.
Full-year revenues were $637.6 million, down 2.9% from the year-ago period. Again, the metric lagged the Zacks Consensus Estimate by 0.4%.
Margins
Gross profit in the reported quarter was $81.9 million, down 39.8% from the prior-year quarter. Gross margin of 64.9% contracted 883 basis points (bps).
Meanwhile, marketing and selling expenses rose 25% to $99.2 million. General and administrative expenses were $73.8 million, down 5.6% year over year. The company incurred adjusted operating loss of $91.1 million in the quarter, wider than the year-ago operating loss of $21.5 million.
Financial Updates
SmileDirectClub exited 2021 with cash and cash equivalents of $224.9 million compared with $316.7 million at the end of 2020. Total debt (short and long-term) at the end of 2021 was $740.9 million compared with $408.6 million at the end of 2020.
Cumulative net cash flow used in operating activities at the end of 2021 was $141.5 million compared with $83.6 million in the year-ago period.
Guidance
SmileDirectClub has issued its guidance for 2022.
The company now expects total revenues in the range of $600 million to $650 million. The Zacks Consensus Estimate for the same is pegged at $712.6 million.
Gross margin (as a percentage of total revenues) is expected in the range of 72.5-75.0% for full-year 2022.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 14.29% due to these changes.
VGM Scores
At this time, SmileDirectClub has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, SmileDirectClub has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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SmileDirectClub (SDC) Up 43.6% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for SmileDirectClub . Shares have added about 43.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is SmileDirectClub due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
SmileDirectClub Q4 Earnings Lag Estimates, Margin Falls
SmileDirectClub, Inc. reported a loss of 25 cents for fourth-quarter 2021, wider than the year-ago loss of 9 cents. However, the figure was narrower than the Zacks Consensus Estimate of a loss of 28 cents.
Full-year loss of 87 cents per share was much wider than the loss of 72 cents. The metric was also wider than the Zacks Consensus Estimate of a loss of 82 cents.
Revenues
Revenues in the fourth quarter totaled $126.3 million, lagging the Zacks Consensus Estimate by 1.9%. The top line declined 31.6% from the year-ago number. The company shipped roughly 66,133 unique aligner orders, down 5.4% sequentially. The quarter’s average aligner gross sales price (ASP) came in at $1,899, down 4.6% on a sequential basis.
Net revenues (related to retainers, whitening, and other ancillary products) came in at $116.5 million, down 32.5% from the year-ago quarter. Financing revenues (interest associated with SmilePay program) in the reported quarter were $9.8 million, down 18.4% from the year-ago quarter.
Full-year revenues were $637.6 million, down 2.9% from the year-ago period. Again, the metric lagged the Zacks Consensus Estimate by 0.4%.
Margins
Gross profit in the reported quarter was $81.9 million, down 39.8% from the prior-year quarter. Gross margin of 64.9% contracted 883 basis points (bps).
Meanwhile, marketing and selling expenses rose 25% to $99.2 million. General and administrative expenses were $73.8 million, down 5.6% year over year. The company incurred adjusted operating loss of $91.1 million in the quarter, wider than the year-ago operating loss of $21.5 million.
Financial Updates
SmileDirectClub exited 2021 with cash and cash equivalents of $224.9 million compared with $316.7 million at the end of 2020. Total debt (short and long-term) at the end of 2021 was $740.9 million compared with $408.6 million at the end of 2020.
Cumulative net cash flow used in operating activities at the end of 2021 was $141.5 million compared with $83.6 million in the year-ago period.
Guidance
SmileDirectClub has issued its guidance for 2022.
The company now expects total revenues in the range of $600 million to $650 million. The Zacks Consensus Estimate for the same is pegged at $712.6 million.
Gross margin (as a percentage of total revenues) is expected in the range of 72.5-75.0% for full-year 2022.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 14.29% due to these changes.
VGM Scores
At this time, SmileDirectClub has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, SmileDirectClub has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.