Align Technology’s ALGN robust product line, balanced growth across all channels and consistent focus on international markets to drive growth bolster our confidence in the stock. The stock carries a Zacks Rank #2 (Buy).
Align Technology, over the past couple of years, has successfully launched its first subscription-based clear aligner program Doctor Subscription Program (DSP) worldwide. The company introduced DSP in the United States and Canada in 2021 and expanded it to Spain and the Nordic countries in the second quarter of 2023. Further, Align Technology has plans to launch DSP in France and the United Kingdom in the second half of 2023.
Further, in the second quarter of 2023, the company successfully continued to roll out the Invisalign Comprehensive Three and Three product in APAC, where it is now available in Hong Kong, Korea, Taiwan and India. It also has plans to launch Invisalign Three and Three product in China in the third quarter of 2023. Instead of unlimited additional aligners within five years of the treatment end date, the latest configuration offers Invisalign comprehensive treatment with three additional aligners included within three years of treatment end date.
Align Technology is expanding its sales and marketing by reaching new countries and regions, including new areas within Africa and Latin America. By the end of 2022, the company sold directly or through authorized distributors in more than 100 countries. Align Technology expects to continue expanding its business in 2023 through investments in resources, infrastructure and initiatives that help drive growth in Invisalign treatment, intraoral scanners and exocad CAD/CAM software in existing and new international markets.
Align Technology, Inc. Price
Align Technology, Inc. price | Align Technology, Inc. Quote
According to the company, by establishing and expanding its key operational activities in locations closer to customers, it can address local and regional needs in a better way.
Over the past year, shares of Align Technology have surged 35% against the industry’s 1.1% fall.
On the flip side, although Align Technology is gradually coming out of the impact of the two-and-a-half-year-long healthcare crisis, the ongoing industry-wide trend of staffing shortages and supply chain-related hazards is denting growth. Deteriorating international trade, with global inflationary pressure leading to a tough situation related to raw material and labor cost as well as freight charges, and a rising interest rate have put the dental treatment space (which is highly-elective) in a tight spot.
All these are creating significant pressure on the company’s operating profit. During the last-reported second quarter, Align Technology witnessed a 6.3% increase in SG&A expenses and a 21.3% rise in R&D expenses. The operating income in the quarter under review highlighted a decline of 8.6%. The operating margin contracted 225 bps to 17.2%.
Other Key Picks
Some other top-ranked stocks in the broader medical space are Haemonetics HAE, Quanterix QTRX and Intuitive Surgical ISRG, each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Haemonetics’ stock has risen 23.6% in the past year. Earnings estimates for Haemonetics have increased from $3.74 to $3.82 for 2023 and remained constant at $4.07 for 2024 in the past 30 days.
HAE’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 19.39%. In the last reported quarter, it posted an earnings surprise of 38.16%.
Estimates for Quanterix’s 2023 loss per share have remained constant at 97 cents in the past 30 days. Shares of the company have increased 196.4% in the past year compared with the industry’s rise of 0.8%.
QTRX’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 30.39%. In the last reported quarter, it posted an earnings surprise of 55.56%.
Estimates for Intuitive Surgical’s 2023 earnings have remained constant at $5.57 per share in the past 30 days. Shares of the company have increased 52.6% in the past year compared with the industry’s rise of 4.7%.
ISRG’s earnings beat estimates in three of the trailing four quarters and missed the same in one, the average surprise being 4.19%. In the last reported quarter, ISRG delivered an earnings surprise of 7.58%.
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