Align Technology Inc (ALGN, Financial) has recently garnered attention from the investment community, thanks to its solid financial position. Despite a slight daily decrease of 0.01% in its share price, currently at $215.22, the company has experienced a significant three-month decline of -38.56%. However, a comprehensive evaluation using the GF Score indicates that Align Technology Inc is poised for considerable growth in the foreseeable future.
What Is the GF Score?
The GF Score is a proprietary ranking system from GuruFocus, designed to predict stock performance by evaluating five key aspects of valuation. This system has been backtested from 2006 to 2021, revealing a strong correlation between high GF Scores and superior long-term stock returns. A GF Score can range from 0 to 100, with 100 indicating the highest potential for outperformance.
- Financial strength rank: 8/10
- Profitability rank: 10/10
- Growth rank: 10/10
- GF Value rank: 8/10
- Momentum rank: 9/10
Each component of the GF Score is individually correlated with stock performance. Align Technology Inc has been awarded a GF Score of 99 out of 100, reflecting its exceptional potential for market outperformance.
Understanding Align Technology Inc's Business
Align Technology Inc, with a market capitalization of $16.48 billion and annual sales of $3.81 billion, is the industry leader in clear aligner manufacturing. Its flagship product, Invisalign, approved by the FDA in 1998, commands over 90% of the market share. Invisalign is capable of treating approximately 90% of all malocclusion cases and is supported by over 230,000 trained dentists and orthodontists worldwide. In 2022 alone, Invisalign treated over 2 million cases, representing about 10% of all orthodontic cases for the year. Since its inception, Invisalign has treated over 14 million patients. Align Technology Inc also markets iTero intraoral scanners, which are used in over half of Invisalign cases to create digital impressions and treatment plans.
Financial Strength Breakdown
Align Technology Inc's Financial Strength rating is a testament to its resilient balance sheet and adept capital management. The company's Altman Z-Score of 5.53 signals a robust defense against financial distress, underscoring its financial stability. Furthermore, its low Debt-to-Revenue ratio of 0.03 indicates a strategic approach to debt management, reinforcing its fiscal health.
Profitability Rank Breakdown
The Profitability Rank of Align Technology Inc highlights its exceptional ability to generate profits compared to its industry counterparts. Additionally, the company's Predictability Rank of 5 stars out of five reflects its consistent operational performance, offering investors a higher degree of confidence in its financial prospects.
Growth Rank Breakdown
Align Technology Inc's high Growth rank underscores its dedication to business expansion. The company's 3-Year Revenue Growth Rate of 16.6% surpasses 71.25% of companies in the Medical Devices & Instruments industry. The significant growth in EBITDA over the past three and five years further emphasizes Align Technology Inc's capacity for sustained growth.
Conclusion: Align Technology Inc's Path to Outperformance
Considering Align Technology Inc's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors seeking companies with similar robust financial indicators can explore more options using the GF Score Screen provided by GuruFocus Premium services. With its market-leading products and strategic financial management, Align Technology Inc stands as a compelling investment opportunity for those looking to capitalize on growth and stability in the dynamic healthcare sector.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
