Invisalign maker Align Technology (NASDAQ:ALGN) has been off to a hot start to 2023, rising around 50% in just the first few months of the new year. In February, the stock made a bullish crossover with its 50-day moving average rising above its 200-day moving average. And it hasn't been trading at these levels since May 2022.
Shares of Align jumped in early February after the company released its year-end numbers for 2022. The company didn't finish on a great note as Q4 net revenue of $901.5 million was down 12.6% from the same period last year. Net income of $41.8 million was also down a whopping 78%.
Despite not offering revenue guidance for 2023, Align's management did say its operations appear to be stabilizing in North America and that it was "cautiously optimistic for continued stability and improving trends as we move through the year." China is a big market for Align and with the country coming out of COVID lockdowns, Align may be able to do better as the year goes on. However, for Q1, the company expects revenues to be similar to what it was in Q4, indicating no growth.
Nonetheless, multiple analysts upgraded the stock in early February and with a consensus price target of over $358, that represent an upside of about 15% from around where Align's stock is trading right now.
However, with some underwhelming results and only cautious optimism to count on, I wouldn't expect Align's stock to continue building off its recent gains. This is a risky stock to be holding right now and investors may be better off waiting for some better earnings numbers before buying shares of Align.
