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Align Technology: Invisalign Growth Continues Globally


On Sep 20, 2016, we issued an updated research report on California-based Align Technology Inc. ALGN, a developer of aligner therapy, intra-oral scanners and CAD/CAM (computer-aided design and computer-aided manufacturing) digital services. Currently, Align carries a Zacks Rank #2 (Buy).

Persistent strong Invisalign volume growth across the company’s entire customer base primarily continues to drive results for Align.

In the last reported quarter, geographically, Align was successful in delivering double-digit sales growth in North America as well as overseas. In North America, the company witnessed continued increase in utilization among its orthodontist customers that reached record levels in both ortho and GP channels.

In the international space too, the company delivered a strong performance across all countries. In the EMEA region, growth was led by Spain, France and the Netherlands. In Asia Pacific, strong expansion was observed in China, Japan, South Asia and Taiwan.

However, a vast majority of Align’s total net revenue is highly dependent on the sale of its Invisalign System and the same trend is expected to continue at least in the near future. Management fears that if consumer demand for Align’s orthodontic services somehow declines or consumers become averse to adopt Invisalign as rapidly as expected, the company’s business may be severely affected.

We are concerned about the ongoing economic uncertainty too, which casts a gloom on Align’s dental procedures as well. The competitive landscape also remains a major headwind.

Key Picks in the Sector

Some other top-ranked medical stocks worth a look are Antares Pharma Inc. ATRS, Derma Sciences Inc. DSCI and Merit Medical Systems, Inc. MMSI. All these stocks hold a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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