Shares of Align Technology (ALGN 1.47%) gained 11.7% in June, according to data from S&P Global Market Intelligence. The orthodontic products company, which is best known for its Invisalign teeth-straightening system, posted gains in line with the broader market, but the stock's movements last month also highlighted the extent to which the underlying business may be impacted by the COVID-19 pandemic.
The company's share price climbed early in the month before a wave of concerns related to the surge of new coronavirus cases across the U.S. prompted a steep sell-off for the stock on June 9. However, the recovery of the broader market helped the orthodontics technology specialist close out the month with double-digit-percentage gains.
The COVID-19 pandemic has created challenging business conditions for Align Technology: Before customers can buy its products, they must visit a dentist and have their teeth scanned. But most U.S. dentists closed their offices as the pandemic took hold. The company's first-quarter sales came in at $551 million, which was down 15.2% on a sequential basis and roughly flat year over year. Management cited a coronavirus-related slowdown in orders as the key factor in the weaker-than-anticipated results, and Align's near-term stock performance could continue to be shaped by developments related to COVID-19 and the trajectory of the pandemic.
Align Technology has continued to gain ground early in July's trading. The stock is up roughly 2% in the month so far.
Align is scheduled to report second-quarter earnings after the market closes on July 22. When it reported first-quarter results in April, it withdrew its full-year guidance and opted not to give second-quarter targets as a result of broad-based uncertainty. Align has a market capitalization of roughly $22 billion and trades at approximately 88 times this year's expected earnings.