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Align Technology Soars as Analysts Rave About Third-Quarter Earnings

Analysts boost their price targets after Align Technology's third-quarter earnings beat Wall Street's expectations.
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Align Technology  (ALGN) - Get Align Technology Inc. Report was getting rave reviews from analysts Thursday after the maker of Invisalign teeth straighteners beat Wall Street's third-quarter earnings expectations. 

Shares of the San Jose-based medical device company were surging 34.8% to $453.

Evercore ISI analyst Elizabeth Anderson wrote in an investors' note that Align Technology "knocked it out of the ballpark” in the quarter.

“Align’s results show continued dental recovery in the U.S.,” Anderson said. “Strong top-line revenue beat, plus much higher-than-expected aligner revenue bodes well for the global recovery, and third-quarter growth likely benefitted from a strong teen season."

Align Technology reported net income of $139.4 million, or $1.76 a share, compared with $102.5 million, or $1.28 a share, a year ago. Adjusted earnings were $2.25 a share.

Revenue totaled $734.1 million, up from the year-ago figure of $607.3 million. Analysts surveyed by FactSet had forecast earnings of 64 cents a share on revenue of $529.3 million. 

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Stifel analyst Jonathan Block said the results topped "any/all 'whisper numbers.'"

Credit Suisse analyst Erin Wilson Wright raised the firm's price target of Align Technology to $432 from $348, while keeping an outperform rating. She said Align Technology's third-quarter non-GAAP earnings-per-share exceeded her forecast on better revenue and profitability.

Piper analyst Jason Bednar, who has an overweight rating on the stock, raised his price target to a Wall Street-high of $500 from $400. 

While management did provide formal guidance, Bednar said qualitative forward-looking commentary "was as encouraging as we could have hoped for."

SVB Leerink’s Richard Newitter, who has an outperform rating on the company, boosted his price target to $460 from $340. 

Align Technology, the analyst said, remains a “unique-in-healthcare growth asset with a large under-penetrated” total addressable market to target, above-average revenue and EPS growth potential, and a healthy balance sheet.