What Happened?
Shares of dental technology company Align Technology (NASDAQ: ALGN) jumped 6.1% in the morning session after the company reported strong third-quarter results that beat revenue and earnings forecasts, driven by higher demand for its Invisalign clear aligners. Revenue for the quarter reached $995.7 million, up 1.8% from the previous year, while adjusted earnings came in at $2.61 per share, both surpassing Wall Street's expectations. The positive results were supported by a 4.9% year-on-year increase in clear aligner sales volumes. Looking ahead, Align Technology provided a forecast for the fourth quarter, expecting revenue to be around $1.04 billion, which was roughly in line with analysts' projections.
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What Is The Market Telling Us
Align Technology’s shares are quite volatile and have had 16 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 20 days ago when the stock dropped 4.5% on the news that worries over worsening trade relations with China were triggered by critical comments from President Donald Trump. The president's tone and the suggestion of canceling a meeting with President Xi caused a rapid sell-off in the market. The trade dispute flared up after China imposed export controls on rare earth minerals, which are critical components for high-tech manufacturing. The escalation of the trade war raises concerns about supply chain disruptions and increased costs for technology companies, which are heavily reliant on global trade, leading to a broad sell-off in the sector.
Align Technology is down 32.8% since the beginning of the year, and at $140.00 per share, it is trading 41.8% below its 52-week high of $240.52 from November 2024. Investors who bought $1,000 worth of Align Technology’s shares 5 years ago would now be looking at an investment worth $328.59.
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