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Align Technology (ALGN) to Post Q4 Earnings: What's in Store?
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Align Technology, Inc. (ALGN - Free Report) is set to release fourth-quarter 2022 results on Feb 1, after the closing bell.
The company reported adjusted earnings per share of $1.36 in the last reported quarter, which missed the Zacks Consensus Estimate by 38.5%. The company beat earnings estimates in one of the trailing four quarters and missed on three occasions, the average negative surprise being 10.7%.
Let’s look at how things have shaped up prior to this announcement.
Factors at Play
Total Clear Aligner
Align Technology is likely to have gained from increasing clear aligners shipments to Invisalign doctors worldwide. In the last reported quarter, the company witnessed increased shipments in Invisalign case volumes across almost all markets — led by Taiwan, Thailand, India and Korea — driven by increased submitters. Analysts expect this trend to have continued in the to-be-reported quarter, aiding sales growth.
Strong potential exists, particularly in the teen segment, with an increase in the number of doctors submitting teen cases in the past few months. Invisalign First for kids has been gaining market share rapidly across all regions. The growing uptake is likely to have sustained, benefiting the company’s top-line growth. During the third quarter, the company commericialized Invisalign innovations for the Align Digital Platform, including the ClinCheck Live Update, Invisalign Practice App, Invisalign Personal Plan, Invisalign Smile Architect, the Invisalign Outcome Simulator Pro with in-face visualization, Cone Beam Computed Tomography with ClinCheck software Invisalign, Virtual AI software and iTero-exocad Connector.
As the economies around the world return to normalcy amid COVID-19 concerns, we anticipate Invisalign case volumes to have rebounded across the Americas and international regions. However, the ongoing conflict in Ukraine and the heightened volatility in foreign exchange rates might have posed hindrances to recovery, hampering business performance in Q4. Staffing shortages and the ongoing inflationary pressure are expected to have dragged the company’s profitability down in Q4.
Our model shows a 12.8% year-over-year decline in total clear aligner revenues in the fourth quarter.
The Zacks Consensus Estimate for Clear Aligner revenues is pegged at $721 million, suggesting an 11.5% drop from the year-ago quarter’s reported figure.
Imaging Systems & CAD/CAM Services Business
Align Technology is expected to have gained from robust iTero scanner services revenues as it did in the previous quarter. The company has been witnessing continued growth in the iTero scanner installed base. The recent integration of iTero NIRI and intraoral camera images unique to iTero Element 5D imaging systems and exocad Rijeka software release, Align Technology is redefining restorative visualization and treatment planning for doctors and labs. This growing uptake of iTero scanners and recent development are likely to have sustained, benefiting the company’s top-line growth.
The continued rise in intraoral digital scans used for Invisalign case submissions signals an enhanced digital adoption within dental offices. During the third quarter earnings update, the company noted that doctors are affirming the substantial benefits of intraoral scanning and end-to-end digital workflows with the iTero scanner and imaging systems. We anticipate this trend to have continued in the to-be-reported quarter, advancing business performance.
The company’s third-quarter results are likely to benefit from exocad CAD/CAM products and services revenues. During the third quarter, the company introduced iTero NIRI. These offerings, including restorative dentistry, implantology, guided surgery and smile design products, extend the Align Digital Platform toward fully integrated interdisciplinary end-to-end workflows. We expect these products to have contributed to the company’s fourth quarter revenue.
Our model projects a 22.1% year-over-year decline in total Imaging Systems & CAD/CAM Services revenues in the fourth quarter. However, the Zacks Consensus Estimate for this segment’s revenues is pegged at $183 million, indicating a 15.3% decline from the year-ago quarter’s reported figure.
Q4 Estimates
The Zacks Consensus Estimate for the company’s fourth-quarter 2022 revenues is pegged at $891.3 million, suggesting a decline of 13.6% from the year-ago reported figure.
The Zacks Consensus Estimate for its fourth-quarter 2022 EPS of $1.54 suggests a 45.58% fall from the year-ago reported figure.
What Our Model Suggests
Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has higher chance of beating estimates. However, this is not the case here, as you can see:
Earnings ESP: The company has an Earnings ESP of +0.65%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #4 (Sell).
Stocks Worth a Look
Here are some medical stocks worth considering, as these have the right combination of elements to post an earnings beat this quarter.
Cardinal Health has a long-term expected earnings growth rate of 11.7%. Cardinal Health’s earnings yield of 6.87% compares favorably with the industry’s 4.34%.
McKesson Corporation (MCK - Free Report) has an Earnings ESP of +0.84% and a Zacks Rank of #2. McKesson is scheduled to release third-quarter fiscal 2023 results on Feb 1.
MCK’s long-term historical earnings growth rate is estimated at 10.1%. MCK’s earnings yield of 6.49% compares favorably with the industry’s 4.34%.
Laboratory Corporation of America Holdings or LabCorp (LH - Free Report) currently has an Earnings ESP of +2.67% and a Zacks Rank of #2. LabCorp is expected to release fourth-quarter 2022 results on Feb 9.
LabCorp’s long-term historical earnings growth rate is estimated at 26.1%. LabCorp’s earnings yield of 7.02% compares favorably with the industry’s 4.34%.
Image: Bigstock
Align Technology (ALGN) to Post Q4 Earnings: What's in Store?
Align Technology, Inc. (ALGN - Free Report) is set to release fourth-quarter 2022 results on Feb 1, after the closing bell.
The company reported adjusted earnings per share of $1.36 in the last reported quarter, which missed the Zacks Consensus Estimate by 38.5%. The company beat earnings estimates in one of the trailing four quarters and missed on three occasions, the average negative surprise being 10.7%.
Let’s look at how things have shaped up prior to this announcement.
Factors at Play
Total Clear Aligner
Align Technology is likely to have gained from increasing clear aligners shipments to Invisalign doctors worldwide. In the last reported quarter, the company witnessed increased shipments in Invisalign case volumes across almost all markets — led by Taiwan, Thailand, India and Korea — driven by increased submitters. Analysts expect this trend to have continued in the to-be-reported quarter, aiding sales growth.
Strong potential exists, particularly in the teen segment, with an increase in the number of doctors submitting teen cases in the past few months. Invisalign First for kids has been gaining market share rapidly across all regions. The growing uptake is likely to have sustained, benefiting the company’s top-line growth.
During the third quarter, the company commericialized Invisalign innovations for the Align Digital Platform, including the ClinCheck Live Update, Invisalign Practice App, Invisalign Personal Plan, Invisalign Smile Architect, the Invisalign Outcome Simulator Pro with in-face visualization, Cone Beam Computed Tomography with ClinCheck software Invisalign, Virtual AI software and iTero-exocad Connector.
As the economies around the world return to normalcy amid COVID-19 concerns, we anticipate Invisalign case volumes to have rebounded across the Americas and international regions. However, the ongoing conflict in Ukraine and the heightened volatility in foreign exchange rates might have posed hindrances to recovery, hampering business performance in Q4. Staffing shortages and the ongoing inflationary pressure are expected to have dragged the company’s profitability down in Q4.
Our model shows a 12.8% year-over-year decline in total clear aligner revenues in the fourth quarter.
The Zacks Consensus Estimate for Clear Aligner revenues is pegged at $721 million, suggesting an 11.5% drop from the year-ago quarter’s reported figure.
Imaging Systems & CAD/CAM Services Business
Align Technology is expected to have gained from robust iTero scanner services revenues as it did in the previous quarter. The company has been witnessing continued growth in the iTero scanner installed base. The recent integration of iTero NIRI and intraoral camera images unique to iTero Element 5D imaging systems and exocad Rijeka software release, Align Technology is redefining restorative visualization and treatment planning for doctors and labs. This growing uptake of iTero scanners and recent development are likely to have sustained, benefiting the company’s top-line growth.
The continued rise in intraoral digital scans used for Invisalign case submissions signals an enhanced digital adoption within dental offices. During the third quarter earnings update, the company noted that doctors are affirming the substantial benefits of intraoral scanning and end-to-end digital workflows with the iTero scanner and imaging systems. We anticipate this trend to have continued in the to-be-reported quarter, advancing business performance.
Align Technology, Inc. Price and EPS Surprise
Align Technology, Inc. price-eps-surprise | Align Technology, Inc. Quote
The company’s third-quarter results are likely to benefit from exocad CAD/CAM products and services revenues. During the third quarter, the company introduced iTero NIRI. These offerings, including restorative dentistry, implantology, guided surgery and smile design products, extend the Align Digital Platform toward fully integrated interdisciplinary end-to-end workflows. We expect these products to have contributed to the company’s fourth quarter revenue.
Our model projects a 22.1% year-over-year decline in total Imaging Systems & CAD/CAM Services revenues in the fourth quarter. However, the Zacks Consensus Estimate for this segment’s revenues is pegged at $183 million, indicating a 15.3% decline from the year-ago quarter’s reported figure.
Q4 Estimates
The Zacks Consensus Estimate for the company’s fourth-quarter 2022 revenues is pegged at $891.3 million, suggesting a decline of 13.6% from the year-ago reported figure.
The Zacks Consensus Estimate for its fourth-quarter 2022 EPS of $1.54 suggests a 45.58% fall from the year-ago reported figure.
What Our Model Suggests
Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has higher chance of beating estimates. However, this is not the case here, as you can see:
Earnings ESP: The company has an Earnings ESP of +0.65%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #4 (Sell).
Stocks Worth a Look
Here are some medical stocks worth considering, as these have the right combination of elements to post an earnings beat this quarter.
Cardinal Health (CAH - Free Report) has an Earnings ESP of +5.75% and a Zacks Rank of #2. The company will release fourth-quarter 2022 results on Feb 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Cardinal Health has a long-term expected earnings growth rate of 11.7%. Cardinal Health’s earnings yield of 6.87% compares favorably with the industry’s 4.34%.
McKesson Corporation (MCK - Free Report) has an Earnings ESP of +0.84% and a Zacks Rank of #2. McKesson is scheduled to release third-quarter fiscal 2023 results on Feb 1.
MCK’s long-term historical earnings growth rate is estimated at 10.1%. MCK’s earnings yield of 6.49% compares favorably with the industry’s 4.34%.
Laboratory Corporation of America Holdings or LabCorp (LH - Free Report) currently has an Earnings ESP of +2.67% and a Zacks Rank of #2. LabCorp is expected to release fourth-quarter 2022 results on Feb 9.
LabCorp’s long-term historical earnings growth rate is estimated at 26.1%. LabCorp’s earnings yield of 7.02% compares favorably with the industry’s 4.34%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.