Align Technology reported Q4 results that beat expectations, but gross margin pressures from a new manufacturing facility and heightened investments will weigh on earnings in 2019, which will push the stock lower today, Piper Jaffray analyst Matt O'Brien tells investors in a research note. The analyst, however, thinks the gross margin pressures "should largely prove transitory" and that the company's investments "make sense given the significant growth management sees in the business in the coming years." He believes Align's strategy "will prove out in this underpenetrated market and commend management for looking longer term." As such, O'Brien recommends buying the stock today on weakness and keeps an Overweight rating on Align despite cutting his price target to $250 from $300.

Align Technology announced that it is planning to repurchase $150M of Align's common stock through open market repurchases under Align's $1.0 billion stock repurchase program that was approved by Align's Board of Directors in January 2023.

Morgan Stanley raised the firm's price target on Align Technology to $360 from $344 and keeps an Overweight rating on the shares, which the firm thinks should rise on the Q1 beat and "surprise" FY24 revenue guidance raise. The raised guidance implies a "healthy" second half ramp, which "inherently comes with risks," but management expressed confidence in market stability and innovation drivers, the analyst tells investors.

Baird raised the firm's price target on Align Technology to $370 from $333 and keeps an Outperform rating on the shares. The firm said the higher forward guide should especially be well-received given March consumer spending/ortho demand uncertainties, and while visibility over the next few quarters admittedly remains limited by macro, the company's consistency is improving.

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