Align Technology (NSDQ:ALGN) today announced that it entered a new accelerated stock repurchase agreement worth up to $200 million.
Tempe, Arizona-based Align may repurchase $200 million of common stock under the $1 billion stock repurchase program announced in May last year. CEO Joe Hogan intends to purchase $2 million of Align’s common stock as well.
Under the terms of the accelerated stock repurchase program, Align will receive an initial delivery of approximately 552,000 shares. The number of shares to be repurchased will also be based on Align’s volume-weighted average stock price during the term of the accelerated stock repurchase and will be completed approximately July 26 and will be funded with Align’s cash on hand.
“We’re pleased to announce a $200 million accelerated stock repurchase program, which reflects the strength of our balance sheet and cash flow generation, as well as management’s and the Board’s continued confidence in our ability to capitalize on the large market opportunities. Returning capital to our shareholders through stock repurchase programs while simultaneously investing in our strategic growth drivers, is consistent with our capital allocation strategy and commitment to increasing shareholder value,” CFO John Morici said in a news release.
The stock repurchase agreement comes after Align Technology missed earnings and revenue estimates in the first quarter of its fiscal year when it reported revenues of $973.22 million.
“Over the past 25 years, we transformed the orthodontic industry with a passion for innovation as we evolved from leading the evolution from digital appliance to digital platform. We are still in the early phases of transforming the orthodontic market. We remain confident in the huge underpenetrated market, our technology and industry leadership, and our ability to execute and make progress toward our Long-Term Model target of 20% to 30% revenue growth. We look forward to sharing more milestones over the next 25 years — as we continue to lead the digital evolution of orthodontics and dentistry to deliver great treatment outcomes and treatment experiences to doctors and patients around the world.”
ALGN shares were up 4.8% to $303.83 apiece in afternoon trading. However, shares in the company are down 32.3% overall since April 4.