Leerink Partners analyst Michael Cherny has reiterated their bullish stance on ALGN stock, giving a Buy rating yesterday.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Michael Cherny has given his Buy rating due to a combination of factors that highlight Align Tech’s long-term potential despite recent setbacks. He acknowledges the disappointing quarterly performance, particularly the lower-than-expected growth in case starts, which was influenced by affordability concerns and a shift in preference towards traditional braces over clear aligners. However, Cherny believes that the market’s reaction to these results has been overly negative, considering Align Tech’s strong cash flow and solid balance sheet, which provide strategic flexibility.
Despite the reduction in the price target from $248 to $188 to reflect the current uncertainties and lower growth estimates, Cherny maintains an Outperform rating. He sees the current stock price decline as an overreaction, given the company’s status as a high-quality franchise with long-term growth prospects. The prudent cost-cutting measures and restructuring efforts are seen as positive steps, even though they come amid a challenging consumer environment. Overall, Cherny’s recommendation is based on the belief that Align Tech’s fundamental strengths will support its recovery and future growth.
Cherny covers the Healthcare sector, focusing on stocks such as Align Tech, DENTSPLY SIRONA, and McKesson. According to TipRanks, Cherny has an average return of 5.2% and a 54.10% success rate on recommended stocks.