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

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Align Technology (ALGN - Free Report) closed the most recent trading day at $611, moving -0.29% from the previous trading session. This change lagged the S&P 500's daily gain of 0.13%.

Heading into today, shares of the maker of the Invisalign tooth-straightening system had gained 3.26% over the past month, lagging the Medical sector's gain of 3.32% and outpacing the S&P 500's gain of 2.16% in that time.

Wall Street will be looking for positivity from ALGN as it approaches its next earnings report date. In that report, analysts expect ALGN to post earnings of $2.56 per share. This would mark year-over-year growth of 831.43%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $937.52 million, up 166.11% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $10.53 per share and revenue of $3.79 billion, which would represent changes of +100.57% and +53.42%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for ALGN. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.42% higher. ALGN currently has a Zacks Rank of #2 (Buy).

Investors should also note ALGN's current valuation metrics, including its Forward P/E ratio of 58.2. This represents a premium compared to its industry's average Forward P/E of 22.24.

Meanwhile, ALGN's PEG ratio is currently 2.51. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. ALGN's industry had an average PEG ratio of 1.8 as of yesterday's close.

The Medical - Dental Supplies industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 99, which puts it in the top 39% 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.

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