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

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In the latest trading session, Align Technology (ALGN - Free Report) closed at $653.98, marking a +1.25% move from the previous day. This change outpaced the S&P 500's 0.62% gain on the day. At the same time, the Dow added 0.55%, and the tech-heavy Nasdaq lost 0.03%.

Heading into today, shares of the maker of the Invisalign tooth-straightening system had gained 0.12% over the past month, lagging the Medical sector's gain of 2.92% and the S&P 500's gain of 0.87% in that time.

Wall Street will be looking for positivity from Align Technology as it approaches its next earnings report date. On that day, Align Technology is projected to report earnings of $2.67 per share, which would represent year-over-year growth of 2.3%. Our most recent consensus estimate is calling for quarterly revenue of $1.02 billion, up 22.23% from the year-ago period.

ALGN's full-year Zacks Consensus Estimates are calling for earnings of $11.10 per share and revenue of $3.94 billion. These results would represent year-over-year changes of +111.43% and +59.45%, respectively.

Investors should also note any recent changes to analyst estimates for Align Technology. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

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. The Zacks Consensus EPS estimate remained stagnant within the past month. Align Technology currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Align Technology has a Forward P/E ratio of 58.9 right now. For comparison, its industry has an average Forward P/E of 20.06, which means Align Technology is trading at a premium to the group.

Meanwhile, ALGN's PEG ratio is currently 2.72. 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 1.52 as of yesterday's close.

The Medical - Dental Supplies industry is part of the Medical sector. This group has a Zacks Industry Rank of 111, putting it in the top 44% 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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