Stock Market Predictions for Align Technology: Is There a Wall Street Consensus of Optimism or Pessimism?
Align Technology Inc., a Tempe, Arizona-based company specializing in the design, manufacture, and marketing of Invisalign clear aligners, iTero intraoral scanners, and related services for orthodontists and dental practitioners, has struggled to keep pace with the broader market over the past year. With a market capitalization of $12.4 billion, ALGN's shares have dropped 30.2% during this period, while the S&P 500 Index (SPX) has rallied nearly 11.6%.
In 2025, ALGN's stock experienced a 14.4% decline compared to the SPX's marginal gains on a year-to-date basis. The underperformance is also noticeable when compared to the SPDR S&P Health Care Equipment ETF (XHE), which has witnessed a 4.6% decline over the past year. The ETF's YTD losses of 7% surpass ALGN's double-digit fall despite the same time frame.
On April 30, ALGN closed down by 2.5% following the release of its Q1 results. Although its adjusted EPS of $2.13 surpassed Wall Street expectations of $1.98, the company's revenue. of $979.3 million, just barely edged out forecasts of $972.8 million. For Q2, ALGN anticipates revenue within the range of $1.05 billion to $1.07 billion.
Analysts expect ALGN's earnings per share (EPS) to grow 19.5% to $8.38 on a diluted basis for the current fiscal year, ending in December. However, the company's earnings surprise history has been disappointing, with it missing the consensus estimate in three of the last four quarters and only beating the forecast on one occasion.
Out of the 13 analysts covering ALGN stock, the consensus recommendation is "Moderate Buy." This is based on nine "Strong Buy" ratings, one "Moderate Buy," two "Holds," and one "Moderate Sell."
On May 15, Evercore ISI analyst Elizabeth Anderson CFA maintained a "Buy" rating on ALGN with a price target of $200, implying a potential upside of 12% from current levels. The mean price target of $234.25 represents a 31.2% premium to ALGN's current price levels, while the Street-high price target of $275 suggests a notable upside potential of 54%.
Several factors could contribute to ALGN's underperformance compared to the broader market and specific sector ETFs: earnings and revenue growth impacted by competition, market sentiment, economic conditions, industry and sector trends, competition, valuation, global economic conditions, among others. Analyst expectations, market sentiment, competition, and pricing provide essential insights into a company's performance, offering investors a comprehensive understanding of its stock performance.
Investors might consider reevaluating their approach to ALGN's stock, given its underperformance in the stock-market, particularly when compared to the S&P 500 Index and the SPDR S&P Health Care Equipment ETF. Despite the company anticipating revenue growth in Q2, analyst expectations and pricing could provide insights into potential upside, such as those offered by Evercore ISI analyst Elizabeth Anderson CFA with a price target of $200 for ALGN stock.
