Please ensure Javascript is enabled for purposes of website accessibility

Why Align Technology Inc.'s Shares Are Rallying 14.5% Today

By Todd Campbell - Updated Apr 28, 2017 at 1:28PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Strong first-quarter sales and earnings are spiking interest in the maker of Invisalign.

What happened

Shares of Align Technology (ALGN 4.51%) were up 14.5% at 1:00 p.m. EDT following first-quarter revenue that was better than industry watchers' forecasts.

So what

Growing global use of Align Technology's Invisalign clear dental aligners has made this a top-performing stock over the past three years, and first-quarter results show that demand remains strong.

A man sits with his back against a wall as money falls from the sky around him.

IMAGE SOURCE: GETTY IMAGES.

In Q1, revenue grew 30%, to $310.3 million, when compared to a year ago. Diluted earnings per share in the quarter clocked in at $0.85, up from $0.50 last year. First-quarter sales were 5.8% higher than they were in the fourth quarter, a good sign given competition from 3M and Dentsply Sirona.

The strong top- and bottom-line results came thanks to a 27% and 9.5% increase in case shipments versus last year and last quarter, respectively. International case shipments were particularly strong, up 41% year over year. 

Now what

Align Technology is forecasting that a 25% to 27% increase in case shipments in Q2 will translate into revenue of between $340 million to $345 million, up 26% to 28% from the same period last year. It also expects to deliver diluted EPS of between $0.71 to $0.74 in the quarter.

Overall, this is yet another solid quarterly result from the company, and although there are ongoing patent challenges and competitors attempting to derail it, I think Align Technology will remain a stock investors will want to own in the coming years.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Align Technology, Inc. Stock Quote
Align Technology, Inc.
ALGN
$247.34 (4.51%) $10.67

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
316%
 
S&P 500 Returns
112%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/03/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.