What happened

Shares of SmileDirectClub (NASDAQ:SDC) were soaring 14.9% higher as of 10:57 a.m. EST on Tuesday. The big jump came after the company announced plans to sell clear aligners to dentists and orthodontists, a move that should boost sales.

So what

Today's announcement from SmileDirectClub was a clear shot over the bow of Align Technology (NASDAQ:ALGN), the leader in the clear aligner market. SmileDirectClub and Align were partners in the past, but SmileDirectClub's exclusive supply agreement with Align expired at the end of 2019, along with a non-compete clause that restricted SmileDirectClub to selling clear aligners only to consumers.

Hand holding a clear dental aligner

Image source: Getty Images.

SmileDirectClub co-founder Alex Fenkell stated, "We have seen increasing demand from the dentists and orthodontists in our network who wish to provide SmileDirectClub clear aligners to their in-office patients, and with our agreement with Align Technology now expired, we are no longer obligated to stay in the direct-to-consumer channel."

Fenkell also said, "We're excited to expand our offerings and welcome new providers to add an important and needed offering to their suite of services."

Earlier this month, SmileDirectClub announced another major change in its strategy with a deal to sell oral care products exclusively at Walmart's U.S. stores and its Walmart.com website. These products, however, don't include clear aligners.

Now what

It remains to be seen just how significant SmileDirectClub's sales to dentists and orthodontists will be. The company will continue to sell clear aligners directly to consumers, which many dental professionals view as a competitive threat. SmileDirectClub has been embroiled in litigation with some state dental associations. 

But it certainly is a healthcare stock that investors will want to keep their eyes on. It recently won a victory with a New Jersey court granting a motion for summary judgment against the New Jersey Dental Association, which alleged that SmileDirectClub had illegally practiced dentistry in New Jersey. And with its strategy now including sales to dental professionals and a partnership with a major retailer, SmileDirectClub could shake up the dental market.