Top-level Insiders at Align Technology Buy Stock

Top-level insiders such as CEOs and CFOs tend to have a good understanding of their companies’ operating activities. If they’re buying company stock, it’s often a sign that the outlook for the business, and the share price, is attractive.

In this report, we are going to highlight buying activity from top-level insiders at Align Technology Inc (ALGN:US). Align Technology is a global medical device company that operates in the orthodontics space. The company is best known for its Invisalign clear aligners. It is listed on the Nasdaq and currently has a market capitalization of approximately $25.21 billion.

Insider Buying at Align Technology

2iQ data shows that on February 8, two top-level insiders at Align purchased company stock. President and CEO Joseph Hogan made the largest purchase, buying 2,928 shares at a price of $341.50 per share (trade value: $999.9k). CFO John Morici made a smaller purchase, picking up 587 shares at a price of $341.84 per share (trade value: $200.7k). Combined, the two insiders invested around $1.2 million in company stock.

Company and Industry Experience

Both of these insiders have considerable company and industry experience. Mr. Hogan has served as CEO of Align since June 2015. Meanwhile, Mr. Morici has served as CFO since November 2016. Earlier in their careers, both served at GE Healthcare in senior leadership positions, where they helped drive significant sales growth.

It’s worth noting that Mr. Hogan has made some well-timed stock purchases in the recent past. In early November, he picked up 10,600 ALGN shares at a price of $188.58 per share. Since then, the stock has risen as high as $439.99. Our Insider Model views the recent buying activity as very bullish.

Better-than-expected Results

Align Technology stock recently moved higher after the company reported better-than-expected Q4 results.

While revenue for the period was down 12.6% year on year to $901.52 million, it was above the consensus forecast of $892.82 million. Adjusted earnings per share came in at $1.73 versus the consensus forecast of $1.56 per share. This represented the first earnings beat in a year.

Looking ahead, management was relatively optimistic about the future.

“As we move through 2023, I am cautiously optimistic that we will see continued stability and an improving operating environment,” said Mr. Hogan. “We remain confident in our large, untapped market opportunity for digital orthodontics and restorative dentistry. We anticipate that 2023 will be a very exciting year for Align innovations as we begin to commercialize one of the largest new product and technology cycles in our 25-year history,” he added.

On the back of the solid results, the Board of Directors authorized a new $1 billion stock repurchase program, to succeed the current $1 billion program that is expected to be completed in Q2 2023.

In light of the earnings beat here, and the stock repurchase program, we see the legal insider trade as a bullish signal.