Align Tech (ALGN) AI Stock Analysis

• Market Cap: $13.17B
• Dividend Yield: N/A
• Average Volume (3M): 812.98K
• Price to Earnings (P/E): 32.4
• Beta (1Y): 1.53
• Revenue Growth: 1.64%
• EPS Growth: -9.60%
• Country: US
• Employees: 21,200
• Sector: Healthcare
• Sector Strength: 58
• Industry: Medical - Devices
• EPS (TTM): 2.13
• Shares Outstanding: 72,484,840
• 10 Day Avg. Volume: 718,762
• 30 Day Avg. Volume: 812,979
• PEG Ratio: -0.86
• Price to Book (P/B): 4.58
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 59.57
• Enterprise Value/Market Cap: 1.19
• Enterprise Value/Revenue: 0.99
• Enterprise Value/Gross Profit: 5.64
• Enterprise Value/Ebitda: 4.84
• 1Y Price Target: $231.91
• Price Target Upside: 30.40% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13

• Rating: 72 Outperform
• Price Target: $197.00 ▲(10.77%Upside)

Align Technology's overall score is bolstered by its strong financial health and positive corporate events, such as the stock buyback program. However, mixed technical indicators and valuation metrics, along with challenges noted during the earnings call, moderate the overall score.

Positive Factors

Geographic Expansion

The company is expanding into new geographies in the EMEA area and deepening penetration in established markets.

Innovation and Technology

Align Technology focuses on technology and innovation, maintaining an edge in workflow and treatment outcomes ahead of competition.

Stock Repurchase Program

The company authorized a new $1Bn share repurchase program after completing its previous $1Bn program.

Negative Factors

Direct Fabrication Impact

Direct fabrication is expected to be a headwind initially, impacting financial performance in the short term before becoming a positive factor in later years.

Growth Headwinds

ASPs will be a growth headwind, especially as mix continues to shift.

Revenue Growth Adjustment

Align Technology's medium-term revenue growth target was adjusted to a more modest range, reflecting a step back from previously ambitious goals.

Align Tech Business Overview & Revenue Model

Company Description

Align Technology, Inc. (ALGN) is a global medical device company that specializes in the design, manufacture, and marketing of Invisalign clear aligners, iTero intraoral scanners, and exocad CAD/CAM software for digital orthodontics and restorative dentistry. The company operates primarily in the healthcare sector, focusing on products and technologies that improve dental and orthodontic treatment outcomes. Align Technology's core product, Invisalign, is a popular alternative to traditional metal braces, offering a clear and removable solution for teeth straightening.

How the Company Makes Money

Align Technology generates revenue primarily through the sales of its Invisalign clear aligners and iTero intraoral scanners. The Invisalign product line is the most significant revenue driver, appealing to both consumers and dental professionals seeking a less invasive and more aesthetically pleasing orthodontic treatment. Revenue from Invisalign is based on the volume of case shipments to orthodontists and general practitioners. The iTero scanners, used for creating digital impressions of patients' teeth, complement the Invisalign system and contribute to revenue through sales and service fees. Align Technology also earns revenue from its exocad CAD/CAM software, which aids in dental restoration workflows. The company benefits from strategic partnerships with dental professionals and clinics worldwide, enhancing its market reach and adoption of its solutions.

Align Tech Financial Statement Overview

Summary

Align Tech maintains a generally strong financial profile with solid profitability, stable leverage, and efficient cash management. Despite stagnant revenue growth and increased operational costs, the company manages operations effectively, maintaining healthy margins and a robust balance sheet.

Income Statement

Align Tech demonstrates a solid financial performance with a consistent gross profit margin around 70% and a healthy net profit margin near 10% over recent periods. However, revenue growth has been stagnant with a slight decline in the TTM period compared to the previous year, indicating potential market challenges or saturation. EBIT and EBITDA margins have also shown resilience, although they've slightly decreased due to increased operational costs.

Balance Sheet

The balance sheet of Align Tech depicts a stable financial position with a low debt-to-equity ratio of approximately 0.02, suggesting minimal leverage and strong financial health. Return on Equity (ROE) is moderately strong, hovering around 10%, highlighting efficient use of equity. The equity ratio remains robust at around 62%, indicating a solid capital structure and a high degree of financial solvency.

Cash Flow

Align Tech's cash flow performance is strong, with consistent free cash flow generation and a positive operating cash flow to net income ratio. Recent periods show a healthy free cash flow to net income ratio, illustrating efficient cash management. However, the free cash flow growth has been moderate, reflecting stable but unspectacular cash flow expansion.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.98B	4.00B	3.86B	3.73B	3.95B	2.47B
	Gross Profit
2.78B	2.80B	2.72B	2.63B	2.94B	1.76B
	EBIT
584.59M	607.63M	643.34M	642.60M	976.40M	387.17M
	EBITDA
804.14M	753.99M	799.04M	755.38M	1.09B	480.71M
	Net Income Common Stockholders
409.56M	421.36M	445.05M	361.57M	772.02M	1.78B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
873.01M	1.04B	972.74M	999.58M	1.17B	960.84M
	Total Assets
6.10B	6.21B	6.08B	5.95B	5.94B	4.83B
	Total Debt
118.53M	119.28M	126.62M	126.91M	125.38M	86.18M
	Net Debt
-754.48M	-924.61M	-810.82M	-815.14M	-974.00M	-874.66M
	Total Liabilities
2.31B	2.36B	2.45B	2.35B	2.32B	1.60B
	Stockholders Equity
3.79B	3.85B	3.63B	3.60B	3.62B	3.23B
Cash Flow		Free Cash Flow
630.74M	622.65M	608.06M	276.83M	771.45M	507.26M
	Operating Cash Flow
762.24M	738.23M	785.78M	568.73M	1.17B	662.17M
	Investing Cash Flow
-200.62M	-254.91M	-195.94M	-213.32M	-563.43M	-231.51M
	Financing Cash Flow
-550.76M	-355.72M	-598.34M	-501.69M	-458.33M	-30.81M

Align Tech Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 177.85
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALGN, the sentiment is Negative. The current price of 177.85 is below the 20-day moving average (MA) of 180.31, above the 50-day MA of 175.77, and below the 200-day MA of 204.68, indicating a neutral trend. The MACD of 1.13 indicates Positive momentum. The RSI at 47.12 is Neutral, neither overbought nor oversold. The STOCH value of 53.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ALGN.

Align Tech Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SNN	80 Outperform	$13.16B	31.14	7.82%	3.07%	4.58%	55.99%
STE	80 Outperform	$23.85B	38.03	9.46%	0.94%	0.32%	64.36%
PODD	76 Outperform	$21.37B	54.82	37.92%	―	23.49%	71.25%
ALGN	72 Outperform	$13.17B	32.36	10.84%	―	1.64%	-9.60%
ZBH	70 Outperform	$18.06B	20.23	7.31%	1.05%	3.30%	-2.39%
GMED	68 Neutral	$8.15B	44.06	4.63%	―	32.26%	112.87%
Sector *	54 Neutral	$5.41B	3.27	-45.10%	3.29%	16.81%	0.02%

Align Tech Corporate Events

Align Tech Approves Key Proposals at Annual Meeting

On May 21, 2025, Align Technology, Inc. held its 2025 Annual Meeting of Stockholders, where several key proposals were approved. These included an amendment to the 2005 Incentive Plan to increase authorized shares, and the replacement of supermajority provisions with simple majority vote requirements in the company’s Certificate of Incorporation. The meeting also ratified the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025. These decisions are expected to impact Align Technology’s governance structure and operational flexibility, potentially influencing shareholder engagement and corporate strategy.

The most recent analyst rating on (ALGN) stock is a Buy with a $400.00 price target. To see the full list of analyst forecasts on Align Tech stock, see the ALGN Stock Forecast page.

Align Tech Announces New $1 Billion Stock Buyback

On May 6, 2025, Align Technology announced a new $1 billion stock repurchase program, following the completion of a previous $1 billion program. This initiative reflects the company’s strong financial position and commitment to increasing shareholder value while investing in strategic growth opportunities. The announcement underscores Align’s confidence in its market opportunities and growth trajectory.