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Align Technology (ALGN) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, Align Technology (ALGN - Free Report) closed at $540.01, marking a -0.47% move from the previous day. This change lagged the S&P 500's daily gain of 0.29%. At the same time, the Dow added 0.58%, and the tech-heavy Nasdaq gained 0.4%.

Prior to today's trading, shares of the maker of the Invisalign tooth-straightening system had lost 8.32% over the past month. This has lagged the Medical sector's loss of 3.48% and the S&P 500's gain of 0.91% in that time.

Investors will be hoping for strength from ALGN as it approaches its next earnings release. In that report, analysts expect ALGN to post earnings of $1.93 per share. This would mark year-over-year growth of 164.38%. Meanwhile, our latest consensus estimate is calling for revenue of $805.04 million, up 46.12% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $9.09 per share and revenue of $3.48 billion, which would represent changes of +73.14% and +40.68%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for ALGN. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. ALGN is holding a Zacks Rank of #1 (Strong Buy) right now.

Looking at its valuation, ALGN is holding a Forward P/E ratio of 61.48. This represents a premium compared to its industry's average Forward P/E of 23.5.

It is also worth noting that ALGN currently has a PEG ratio of 3.1. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Medical - Dental Supplies was holding an average PEG ratio of 2.11 at yesterday's closing price.

The Medical - Dental Supplies industry is part of the Medical sector. This group has a Zacks Industry Rank of 73, putting it in the top 29% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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