Align Technology, are the Bulls on their way?
Company: ALGN [NASD] Align Technology, Inc.
Description: Align Technology, Inc., a medical device company, designs, manufactures, and markets Invisalign clear aligners and iTero intraoral scanners and services for orthodontists and general practitioner dentists, and restorative and aesthetic dentistry. It operates in two segments, Clear Aligner: and Scanners and Services.
Why this Stock?
Algin’s valuation isn't near its peak levels reached in previous years.
More importantly, the company is only scratching the surface of its opportunity in the clear aligner market. Align currently has a market share of only 11%. Its market share for teens is even lower at 5%.
The company has a clear strategy to gain more of that addressable market. Align continues to aggressively market its Invisalign aligners with a primary focus to reach teens through digital media. It's also investing in development to expand the types of orthodontic cases where its clear aligners can be used.
Its main competitor SmileDirectClub has profitability problems that aren't getting better and competitive threats to the company's flawed business model are easy to see.
While Align Technology blocks SmileDirectClub's path to growth by selling aligners to people with access to general dentistry, Dentsply Sirona is coming after SmileDirectClub's traditional customers. The service Dentsply Sirona acquired at the end of 2020 sells a low-cost option that employs professional dentists at a distance, so customers don't actually need to visit a dentist in person. It doesn't look like SmileDirectClub can win a pricing war with either of its big competitors. Dentsply Sirona's new subsidiary Byte sells aligners starting at just $1,895 per set.
That's just a hair above the average sales price of $1,885 that SmileDirectClub reported in the second quarter. Align Technology's average selling price to bricks-and-mortar dentists is around $1,050 for sets of relatively simple aligners.
Dentsply Sirona is a very profitable company that can afford to sell clear aligners at a loss until SmileDirectClub implodes -- and it might not take very long.
SmileDirectClub finished June with just $$377 million after losing $151 million in the first half of the year. Another year of heavy losses is probably more than its shareholders can handle before they run for the exits.
Below is what institutions are setting as their targets for ALGN stock price over the coming years.
With a clear buy sentiment being shown from the investment banks and institutions this is another confirmation that thus stock is set to see growth over the long term. Looking ahead we see price is poised to reverse to the upside based on good Q3 results, expecting for the recent upward momentum to be continued, with our first target set at $732.00.
Align Technology (ALGN) Risk Checks:
Fail Have profit margins improved over the past year?
Profit margins (20.1%) are lower than last year (78.7%)
Fail Has there been substantial insider selling in the past 3 months?
Significant insider selling over the past 3 months
Pass Are they forecast to achieve profitability?
The company is currently profitable
Pass Are revenue and earnings forecast to grow?
Earnings are forecast to grow by an average of 23% per year for the next 3 years
Pass Are they in a good financial position?
They are debt free
Pass Is their share price liquid and stable?
Share price has been stable over the past 3 months
Pass Do they have high quality earnings?
The company’s earnings are high quality
Pass Do they have sufficient financial data available?
They have sufficient analyst coverage
Pass Are there any concerning recent events?
No concerning events detected
Pass Have shareholders been diluted over the past year?
Shareholders have not been meaningfully diluted in the past year or recently listed
Pass Do they have meaningful levels of revenue?
Revenue is meaningful (33B)
Pass Do they have a meaningful market capitalization?
Market cap is meaningful (47B)
Pass Do they have negative shareholders equity?
ALGN does not have negative shareholders equity.
Description: Align Technology, Inc., a medical device company, designs, manufactures, and markets Invisalign clear aligners and iTero intraoral scanners and services for orthodontists and general practitioner dentists, and restorative and aesthetic dentistry. It operates in two segments, Clear Aligner: and Scanners and Services.
Why this Stock?
Algin’s valuation isn't near its peak levels reached in previous years.
More importantly, the company is only scratching the surface of its opportunity in the clear aligner market. Align currently has a market share of only 11%. Its market share for teens is even lower at 5%.
The company has a clear strategy to gain more of that addressable market. Align continues to aggressively market its Invisalign aligners with a primary focus to reach teens through digital media. It's also investing in development to expand the types of orthodontic cases where its clear aligners can be used.
Its main competitor SmileDirectClub has profitability problems that aren't getting better and competitive threats to the company's flawed business model are easy to see.
While Align Technology blocks SmileDirectClub's path to growth by selling aligners to people with access to general dentistry, Dentsply Sirona is coming after SmileDirectClub's traditional customers. The service Dentsply Sirona acquired at the end of 2020 sells a low-cost option that employs professional dentists at a distance, so customers don't actually need to visit a dentist in person. It doesn't look like SmileDirectClub can win a pricing war with either of its big competitors. Dentsply Sirona's new subsidiary Byte sells aligners starting at just $1,895 per set.
That's just a hair above the average sales price of $1,885 that SmileDirectClub reported in the second quarter. Align Technology's average selling price to bricks-and-mortar dentists is around $1,050 for sets of relatively simple aligners.
Dentsply Sirona is a very profitable company that can afford to sell clear aligners at a loss until SmileDirectClub implodes -- and it might not take very long.
SmileDirectClub finished June with just $$377 million after losing $151 million in the first half of the year. Another year of heavy losses is probably more than its shareholders can handle before they run for the exits.
Below is what institutions are setting as their targets for ALGN stock price over the coming years.
With a clear buy sentiment being shown from the investment banks and institutions this is another confirmation that thus stock is set to see growth over the long term. Looking ahead we see price is poised to reverse to the upside based on good Q3 results, expecting for the recent upward momentum to be continued, with our first target set at $732.00.
Align Technology (ALGN) Risk Checks:
Fail Have profit margins improved over the past year?
Profit margins (20.1%) are lower than last year (78.7%)
Fail Has there been substantial insider selling in the past 3 months?
Significant insider selling over the past 3 months
Pass Are they forecast to achieve profitability?
The company is currently profitable
Pass Are revenue and earnings forecast to grow?
Earnings are forecast to grow by an average of 23% per year for the next 3 years
Pass Are they in a good financial position?
They are debt free
Pass Is their share price liquid and stable?
Share price has been stable over the past 3 months
Pass Do they have high quality earnings?
The company’s earnings are high quality
Pass Do they have sufficient financial data available?
They have sufficient analyst coverage
Pass Are there any concerning recent events?
No concerning events detected
Pass Have shareholders been diluted over the past year?
Shareholders have not been meaningfully diluted in the past year or recently listed
Pass Do they have meaningful levels of revenue?
Revenue is meaningful (33B)
Pass Do they have a meaningful market capitalization?
Market cap is meaningful (47B)
Pass Do they have negative shareholders equity?
ALGN does not have negative shareholders equity.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.