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Align Technology Hits a 52-Week High on Solid Prospects

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Share price of San Jose, CA-based Align Technology, Inc. (ALGN - Free Report) reached a new 52-week high of $110.87 on Mar 15, eventually closing a bit lower at $110.31. The company gained 61.1% over the past one year, much better than the S&P 500’s gain of 16.8% over the same period. The stock has a market cap of $8.86 billion.

Over the last one month, Align has outshined the Zacks categorized Medical - Dental Supplies industry with respect to share price movement. The stock has climbed 8.5%, way higher than the broader industry’s gain of only 0.8%.


Further, Align’s estimate revision trend for the current quarter is favorable. In the past 60 days, eight estimates have moved up with one downward revision. The magnitude of estimate revision over the same time period increased from 64 cents per share to 67 cents.

Over the past two months, the magnitude of the company’s estimate trend has been encouraging, increasing from $2.98 per share to $3.00 over the same time frame.

The company also has a trailing four-quarter average positive earnings surprise of 20.23%.

Additionally, Align’s long-term growth fundamentals are compelling. The Zacks Rank #3 (Hold) company recorded a five-year CAGR of 17.8% for revenue. It also has a five-year earnings growth rate of 19.5% compared to the industry’s average of 12%. The company has an impressive Growth Style Score of ‘B’. Our Growth Style Score highlights all the vital metrics of the company’s financials to obtain a clearer picture of the quality and sustainability of its growth. Our research shows that stocks with Style Scores of ‘A’ or ‘B’ when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 offer the best investment opportunities.

Growth Drivers

The latest 52-week high came on the back of its recent series of developments. Recently, Align announced a new patient-friendly solution by introducing Invisalign Teen Solution with mandibular advancement for teen patients. This latest dental technology helps in moving the lower jaw forward while simultaneously aligning the teeth.

To further popularize its Invisalign brand and product, the company launched an integrated advertising campaign. The company aims to make more people aware of the benefits of treatment with Invisalign clear aligners, the most advanced and recognized clear aligner system in the world.

The company has also expanded work flow options of its leading iTero scanners. Management has announced the availability of scanners combined with Nobel Biocare’s implants and Elos Medtech’s scans. Management believes that the tie-up with these two companies will help the company grow and offer restorative solutions to the dental community.

Meanwhile, Align has been on an acquisition spree to expand its foothold globally. The company acquired two of its distributers – G.L. Dental Couture Limited and Align Technology Do Brasil LTDA – last month. The G.L. Dental Couture Limited buyout lends Align direct access to customers and distribution partners in Europe, Middle East and Africa. The Align Technology Do Brasil LTDA takeover allows management to focus on the commercial, marketing and operational needs of doctors and patients in Brazil.

All these factors are expected to boost the company’s share price in the days ahead.

Key Picks

Better-ranked stocks in the medical product sector are Inogen, Inc. (INGN - Free Report) , Bovie Medical Corporation and ResMed, Inc. (RMD - Free Report) . Inogen sports a Zacks Rank #1 (Strong Buy) while the other two companies carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Inogen gained 87.3% in the last one year in comparison to the S&P 500’s gain of 16.8%. The company has a stellar four-quarter average earnings surprise of over 49.08%.

Bovie Medical surged 44.7% in the last one year in comparison to the S&P 500. It has a four-quarter average earnings surprise of 28.7%.

ResMed gained over 27.7% in the past one year, better than the S&P 500 mark. It also has a trailing average earnings surprise of 0.31%.

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