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Align Technology (ALGN) Dips More Than Broader Markets: What You Should Know

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Align Technology (ALGN - Free Report) closed at $600.05 in the latest trading session, marking a -0.94% move from the prior day. This move lagged the S&P 500's daily loss of 0.2%.

Heading into today, shares of the maker of the Invisalign tooth-straightening system had gained 8.27% over the past month, outpacing the Medical sector's gain of 4.08% and the S&P 500's gain of 2.11% in that time.

Wall Street will be looking for positivity from ALGN as it approaches its next earnings report date. On that day, ALGN is projected to report earnings of $2.56 per share, which would represent year-over-year growth of 831.43%. Meanwhile, our latest consensus estimate is calling for revenue of $937.52 million, up 166.11% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $10.53 per share and revenue of $3.79 billion. These totals would mark changes of +100.57% and +53.42%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for ALGN. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.42% higher within the past month. ALGN is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note ALGN's current valuation metrics, including its Forward P/E ratio of 57.53. For comparison, its industry has an average Forward P/E of 22.74, which means ALGN is trading at a premium to the group.

We can also see that ALGN currently has a PEG ratio of 2.48. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Medical - Dental Supplies stocks are, on average, holding a PEG ratio of 1.8 based on yesterday's closing prices.

The Medical - Dental Supplies industry is part of the Medical sector. This group has a Zacks Industry Rank of 102, putting it in the top 41% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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