On Sep 26, 2014, we issued an updated research report on Align Technology Inc. (ALGN). Align exited second-quarter 2014 on a mixed note with its top line sailing past the Zacks Consensus Estimate while earnings missed the same. We still remain worried about the current economic uncertainty which continues to cast a negative impact on dental procedures.
Banking on its core product – Invisalign Clear Aligner, Align has established itself as a strong player in the malocclusion market. Over the past few quarters, sales have increased consistently riding on the strength of this product. Moreover, several features have been introduced across the Invisalign system, designed to address some of the most significant treatment challenges encountered by doctors. The company’s Invisalign G3 and G4 are working successfully for its class II and class III patients. Moreover, in Feb 2014, Align launched Invisalign G5 innovations which are specifically used to treat deep bite malocclusion.
Notably, the reported quarter saw record unit volumes in scanner and services, which were up more than 50% year over year. Earlier this month, Align entered into a partnership with Carlsbad, CA-based Zimmer Dental, Inc. According to Align, this partnership will offer a digital implant workflow within digital dentistry and will enable clinicians to enhance custom abutment solutions.
In the second quarter, international volume increased more than 26%, reflecting strong growth in both EMEA and Asia Pacific driven by go-to-market and sales coverage investments, improving clinical education, and support and enthusiasm around new products like Invisalign G5. The company believes that the new features and functionality delivered with Invisalign G4 and G5 are more effective outside North America, especially in Asia, due to the higher complexity of cases among the Asian population. We are also encouraged with the company’s new product pipeline development.
However, the general slowdown in the U.S. and certain international economies is having a negative impact on consumer spending and affecting Align’s business fundamentals. Competitive landscape also remains challenging.
Other Stocks to Consider
Some stocks that warrant a look in the same sector are AmerisourceBergen Corporation (ABC), Laboratory Corp. of America Holdings (LH) and McKesson Corporation (MCK).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment