Back to top

Image: Bigstock

What's in the Cards for SmileDirectClub's (SDC) Q1 Earnings?

Read MoreHide Full Article

SmileDirectClub, Inc. (SDC - Free Report) is scheduled to report first-quarter 2020 results on May 13, after the closing bell.

SmileDirectClub has a negative earnings surprise of 177.8% in the last reported quarter.

Q1 Estimates

For the to-be-reported quarter, the Zacks Consensus Estimate for revenues is pegged at $218.1 million. The same for adjusted earnings per share is a loss of 22 cents.

Factors to Note

SmileDirectClub enjoys a strong international presence, which is likely to have benefited first-quarter performance.

Outside the United States, SmileDirectClub has a strong presence across Canada, Australia, the U.K., New Zealand and Ireland. The company’s efforts to further expand internationally, driven by a broad array of products, might get reflected in the results for the quarter to be reported.

SmileDirectClub Inc Price and EPS Surprise


SmileDirectClub Inc Price and EPS Surprise

SmileDirectClub Inc price-eps-surprise | SmileDirectClub Inc Quote

The company remains focused on product development. Management is optimistic about a series of product launches (in December 2019) including an expanded suite of oral care products, comprising its patent pending toothbrush, Smile Style water flosser, bright on premium whitening and sensitive and whitening toothpaste. These are expected to have driven the first-quarter performance.

Apart from these, the company’s strategic partnerships with CVS Health and Walgreens deserve mention. Driven by these collaborations, the company’s has launched innovative night-time-only clear aligners and an oral care product line, which have added new customer acquisition channel and bolstered the life time value of its club members. These may get reflected in the to-be-reported quarter’s results.

SmileDirectClub is one of the largest 3D printing manufacturers in the United States. In response to the COVID-19 pandemic, the company has opened up a 3D printing facility completely dedicated to producing much needed medical supplies. In order to combat this crisis, the company has collaborated with medical supply companies and health organizations to produce supplies including medical face shields and respirator valves. This, in turn, is likely to have positively impacted performance in the first quarter.

However, management anticipates to have incurred higher operating expenses in the first quarter, which might have weighed on margins.

Earnings Whispers

The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here as you will see below.

Earnings ESP: SmileDirectClub has an Earnings ESP of -3.60%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #3.

Stocks Worth a Look

Here are a few medical stocks worth considering as they have the right combination of elements to post an earnings beat this quarter.

BioLife Solutions, Inc. (BLFS - Free Report) has an Earnings ESP of +816.68% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

HEXO Corp. (HEXO - Free Report) has an Earnings ESP of +25.00% and a Zacks Rank of 3.

Motus GI Holdings, Inc. (MOTS - Free Report) has an Earnings ESP of +3.08% and a Zacks Rank of 2.

Just Released: Zacks’ 7 Best Stocks for Today

Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.1% per year.

These 7 were selected because of their superior potential for immediate breakout.

See these time-sensitive tickers now >>