Sientra Stock Sinks on 4Q Whiff, Downgrade

There is still more room for downgrades on the medical device stock

The shares of Sientra Inc (NASDAQ:SIEN) are down 22.5% to trade at $8.82, one of the worst stocks on the Nasdaq this morning, after the company reported a fourth-quarter loss of 86 cents per share, steeper than the 68 cents per-share loss analysts were expecting. In response, William Blair downgraded the silicone implants producer to "market perform," while SVB Leerink and Dougherty trimmed their price targets to $18 and $27, respectively.

SIEN is on track for its worst single-session loss since September 2015, and has been stuck in a channel of lower highs and lows since its Sept. 10 peak near $27. More recently, the $10 level had served as a short-term floor for the shares, with their 50-day moving average containing breakout attempts above. Earlier though, the equity tapped its March 26 bottom of $8.79.

The equity could be pressured lower by more bear notes. While all seven brokerages in coverage of SIEN rated it a "buy" or better at last night's close, its consensus 12-month price target of $21.43 is a 142.4% premium to the security's current perch.

Short sellers are likely cheering today's collapse. While short interest fell 12.6% in the most recent reporting period, the 2.3 million shares still sold short represents a healthy 11.9% of SIEN's total available float, and 3.4 times the average daily trading volume. However, these bears are sidelined at the moment, with the stock on the short-sale restricted list.