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Align Gains on Innovation Despite Poor Case Shipment in China

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On Sep 25, we issued an updated research report on Align Technology, Inc. ALGN. The company is riding on strong product development and a consistent focus on international markets. However, the current economic unrest persists to cast a negative impact on Align Technology’s dental procedures. The stock carries a Zacks Rank #3 (Hold).

Align Technology's steady momentum in Invisalign volumes across all geographies and solid worldwide volume growth for teenage patient cases buoy optimism on the stock. A solid performance in the EMEA region and APAC markets is also a plus.

Maintaining its last-year performance, Align Technology continued with its winning streak of delivering a sturdy Invisalign Technology volume expansion across the company’s entire customer base. Geographically, the company is witnessing strength in North America as well as overseas. In the last reported quarter, in North America, the company continued to witness a widening GP Dentist customer base along with a sustained uptrend in Invisalign utilization by orthodontists. Internationally, we are encouraged by a solid performance in the EMEA and the Asia Pacific (APAC) markets. Notably, the EMEA market is the second-largest space of growth for Align Technology.

Align Technology, Inc. Price

Align Technology, Inc. Price
Align Technology, Inc. Price

Align Technology, Inc. price | Align Technology, Inc. Quote

In terms of portfolio enhancement, in September 2019, Align Technology announced the commercial availability of the iTero Element 2 scanner in China. Earlier in March, the company launched a new online tool called SmileView.

Previously, Align Technology launched its latest digital treatment planning facility and education center in Madrid, Spain. The company also introduced the Invisalign First clear aligners for treatment of younger patients with early mixed dentition successively in the United States, Australia, New Zealand, Japan and the EMEA region starting July 2018.

On the flip side, Align Technology registered a dull Invisalign case shipment in China, which dragged down the entire case shipment in the second quarter of 2019. According to the company, this was due to a tough consumer environment in China. This apart, there was slower growth in young adult cases noticed in North America. Also, looking at the third-quarter guidance, we expect this lackluster trend to linger over the period.

Shares of the company have underperformed its industry over the past three months. The stock has plunged 31.7%, wider than the industry's 2.9% fall.

Key Picks

Some better-ranked stocks from the broader medical space are Capricor Therapeutics, Inc CAPR, GW Pharmaceuticals PLC GWPH and Neurotrope, Inc NTRP.

Capricor has a Zacks Rank #2 (Buy) and an anticipated third-quarter 2019 earnings growth rate of 28.2%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

GW Pharmaceuticals estimates third-quarter earnings growth rate to be 72.8%. It currently flaunts a Zacks Rank #1.

Neurotrope has a Zacks Rank of 2 and a projected third-quarter earnings growth rate of 27.7%.

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Capricor Therapeutics, Inc. (CAPR) : Free Stock Analysis Report
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Align Technology, Inc. (ALGN) : Free Stock Analysis Report
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