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Align Technology at 52-Week High: What's Driving the Stock?

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Share price of Align Technology, Inc. (ALGN - Free Report) scaled a new 52-week high of $179.96 on Sep 5, eventually closing nominally lower at $179.33. The company has gained 86.2% over a year, much higher than the S&P 500’s gain of 12.9% over the same frame. Align Technology has also beat the broader industry’s gain of 3.6% with respect to share price movement over the year. The stock has a market cap of $14.37 billion.

Further, Align Technology’s estimate revision trend for the current year is favorable. In the past 60 days, nine estimates moved up while one moved down. The estimates were up from $3.28 per share to $3.40 over the same time frame.

The company also has a trailing four-quarter average positive earnings surprise of 16.7%. Its positive long-term growth of 26.6% holds promise.

The company’s five-year historical growth rate is also favorable at 19.5% as compared with the broader industry’s 10.40%.

Align Technology carries a Zacks Rank #3 (Hold). The company has an impressive Growth Style Score of B. Our Growth Style Score highlights all the vital metrics of a company’s financials to obtain a clearer picture of the quality and sustainability of its growth. Our research shows that stocks with Style Scores of A or B when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 offer the best investment opportunities.

Growth Drivers

The market is upbeat about the non-exclusive distribution agreement signed with Patterson Dental in September 2017. Per the agreement, Align Technology’s iTero Element intraoral scanning system will be available under Patterson Dental’s CAD/CAM portfolio in the United States and Canada. This will boost the iTero scanner customer base to a considerable extent.

Further, in June, Align Technology had announced its inclusion in the esteemed S&P 500 Index, which boosted investors’ confidence in the stock considerably.

We are also encouraged by Align Technology’s solid second-quarter 2017 performance with year-over-year increase in earnings and revenues. The company’s encouraging InvisAlign Technology prospects and growth in North America and international regions also raise hopes. The company recently opened a new InvisAlign Technology Treatment Planning facility in China. Meanwhile, the company’s multi-million dollar marketing campaign for the InvisAlign Technology brand is encouraging.

All these factors are expected to boost the company’s share price in the days ahead.

Key Picks

A few better-ranked medical stocks are Edwards Lifesciences Corporation (EW - Free Report) , Lantheus Holdings, Inc. (LNTH - Free Report) and IDEXX Laboratories, Inc. (IDXX - Free Report) . Edwards Lifesciences sports a Zacks Rank #1, while Lantheus Holdings and IDEXX Laboratories carry a Zacks Rank #2. You cansee the complete list of today’s Zacks #1 Rank stocks here.

Edwards Lifesciences has a long-term expected earnings growth rate of 15.2%. The stock has rallied roughly 23.6% over the last six months.

Lantheus Holdings has a long-term expected earnings growth rate of 12.5%. The stock has gained 30.2% over the last six months.

IDEXX Laboratories has a long-term expected earnings growth rate of 19.8%. The stock has gained around 5.9% over the last six months.

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