2/17/2021 SmileDirectClub Is Battling Over the Future of Braces | Barron's

CONSUMER PREVIEW

SmileDirectClub Is Battling With Dentists.

Investors Are Caught in the Middle.
By Evie Liu Oct. 18, 2019 8:00 pm ET

Illustration by Elias Stein

Just last month, teeth-fixer SmileDirectClub priced its initial public offering at $23
per share. Shares closed the past week at $9.46, down nearly 60%. That’s not the
kind of realignment that SmileDirect had in mind when it decided to go public.

The company was built on a disruptive brand of orthodontia that’s closer to

shopping for sunglasses than visiting a dentist. Customers go to a SmileDirect store
or take an at-home mold of their teeth. From there, the company creates a plastic
aligner that customers can wear to bed. The treatment usually takes six months,
with a one-time payment of $1,900. (A 24-month payment option comes to $2,290.)

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2/17/2021 SmileDirectClub Is Battling Over the Future of Braces | Barron's

Not surprisingly, dentists and orthodontists aren’t

thrilled. The American Dental Association has asked the Federal Trade Commission
to “investigate false and misleading claims” from SmileDirect, arguing that a
prescription should be necessary for moving teeth.

But Not Much to Investors are caught in the middle.

Smile About SmileDirectClub shares fell 15% this past week
SmileDirectClub stock has after the California legislature passed a bill
slumped since its IPO in requiring an orthodontics provider to review
September. recent patient X-rays. In a statement following the
$20.0 bill’s passage, SmileDirect said, “Simply put, this
bill represents the dental lobby’s thinly veiled
17.5
attempt to protect traditional dentistry at the

15.0
expense of Californians.”

12.5 SmileDirect will probably have more to say when

the company reports earnings next month. For
10.0
now, Wall Street isn’t worried about the fight with

7.5
dentists. All seven analysts tracked by Bloomberg
rate SmileDirect stock at Buy or its equivalent.
Sept. 23 Oct. 7
Source: FactSet

Next Week

Monday 10/21
Cadence Design Systems, Halliburton, TD Ameritrade Holding, and Zions Bancorp
report quarterly results.

Tuesday 10/22
Biogen, Chipotle Mexican Grill, Hasbro, Lockheed Martin, McDonald’s, Novartis,
Procter & Gamble, Texas Instruments, United Parcel Service, and United
Technologies report earnings.

The National Association of Realtors reports existing-home sales for September.

Economists forecast a seasonally adjusted annual rate of 5.5 million, even with
August’s data.

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