Silk Road Medical (NASDAQ:SILK) stock halved in value at the start of Wednesday’s trading after an after-hours profit warning.
The company, which has developed a treatment for carotid artery disease, which is a cause of stroke, on Tuesday downgraded revenue guidance and announced the pending retirement of its chief executive Erica Rogers.
Silk Road reported preliminary third quarter revenue of $44.4 million, versus market consensus of $46.3 million.
Looking to the full year, revenue guidance was set in a range between $170 million and $174 million, which the company said represented between 23% and 26% upside from its previous guidance.
Wall Street analysts previously penciled in a consensus forecast of $181.7 million for the full year.
In New York, Silk Road stock was down $7.09, or 50.6%, changing hands at $6.94 per share.
Analysts at Citi reacted to Rogers departure and the guidance downgrade by slashing the bank’s rating to ‘Sell’ from ‘Buy’, with a new price target wiping out previously envisaged upside, now set at $8 from $35 per share.
Rogers is expected to retire from the company once Silk Road completes a succession process.
“It has been an honor to work with the Silk Road team through more than a decade of progress toward improving patients’ lives,” Rogers said in a statement.
“We have set the stage for an exciting future for the company.
“I look forward to supporting a smooth transition and cheering on our team as they continue to promote TCAR as the gold standard in stroke prevention.”
Silk Road chair, Jack Lasersohn, commented: “Erica has been integral in leading and expanding the company’s strong operational infrastructure and commercial enterprise and driving a significant expansion of the use of Transcarotid Artery Revascularization (TCAR) and its impact on patients.
“The Silk Road Medical senior leadership team and Board of Directors are well-prepared for Erica’s transition. We plan to work closely together to ensure a smooth process as we drive continued growth in the business.”