Align Technology Struggles Despite Strong Market Position and Analyst Optimism
Tempe, Arizona-based Align Technology, Inc. (ALGN) stands as a leading player in the medical devices sector, widely recognized for its Invisalign clear aligners and iTero intraoral scanners. With a market capitalization of $12.4 billion, Align has significantly transformed orthodontics and digital dentistry through its innovative solutions.
Companies valued at $10 billion or more are classified as “large-cap stocks,” and Align exemplifies this category. Its impressive valuation underscores a robust presence in the healthcare market, propelled by advanced products and technology in the dental field.
Active Investor: FREE newsletter offering insights on trending stocks and trade ideas
However, despite its strengths, Align Technology has experienced a severe downturn. The ALGN stock has decreased by 48.6% from its peak of $331.64 reached on April 11, 2024. In the past three months, its value has dropped 20.2%, significantly lagging behind the Dow Jones Industrial Average, which has seen a modest decline of just 1.7% in the same timeframe.
Align’s performance over a longer period is even less encouraging. The stock has plunged 31.6% in the last six months and 46.7% over the past year, contrasting sharply with the Dow’s slight increase of 89 basis points over six months and a 7.9% gain year-over-year.
Further validating this bearish trend, ALGN has consistently traded below its 200-day moving average since late April 2024 and its 50-day moving average since early February 2025.
Recently, Align Technology saw a slight rebound in stock prices following the release of its mixed Q4 results on February 5. A modest rise in sales for Clear Aligners and a notable 14.9% year-over-year uptick in Imaging Systems and CAD/CAM Services, amounting to $200.9 million, helped boost the company’s overall revenue by 4% year-over-year to $995.2 million. However, this result fell short of analysts’ expectations.
Align’s income from operations faced challenges, falling by 16% year-over-year to $144.2 million, largely due to a significant increase in SG&A expenses and $33.2 million in restructuring costs. Nevertheless, after adjusting for one-time items and considering the impact of share repurchases, Align’s non-GAAP EPS rose by 83 basis points to $2.44, narrowly beating consensus estimates.
In comparison, Align has underperformed against its peer Hologic, Inc. (HOLX), which has seen a 23.8% decline over the past six months and a 17.8% drop over the last year.
Despite the disappointing performance, analysts maintain a positive outlook for Align. The consensus rating among the 13 analysts covering ALGN is a “Moderate Buy.” The average price target stands at $258.25, indicating a potential upside of 51.6% from current price levels.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
More news from Barchart
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
