This is an old version of ALGN from 13 days ago (Oct 31, 2026).See the latest version
ALGN
- Price
- $149.89
- Discount category
- Below intrinsic value
- Next earnings
- Jan 28, 2027
- Next earnings is estimate
- Yes
- Company name
- Align Technology
- Sector
- Dental devices
- About
- Align Technology makes the Invisalign system of clear aligners, iTero intraoral scanners and exocad CAD/CAM software for orthodontics and restorative dentistry. Orthodontists and general dentists prescribe Invisalign treatment, and Align makes custom aligners for each patient from digital scans. Clear Aligner revenues were $3.2 billion of total revenues of $4.0 billion in 2025, and Align shipped about 2.6 million Clear Aligner cases that year. The iTero scanners and exocad software connect dental practices to Align's digital workflow. Align is based in Tempe, Arizona, and it sells around the world, with fast growth in Asia Pacific, Europe and Latin America.
- Thesis
- The market prices Align for slow growth in a business that once grew fast. In October 2026, Align lowered its 2026 revenue outlook to $4,110 million to $4,130 million, about 2% more than in 2025 and below its earlier outlook of 3% to 4% growth. It expects Clear Aligner volume and revenue to grow about 5% to 6%, with the average price slightly down. Imaging Systems and CAD/CAM Services revenues fell 7.6% in Q3 2026, because dentists buy fewer capital goods and choose lower-priced scanners or leases. Other clear aligner makers, including lower-priced brands, compete for the same doctors and patients. In July 2026, after talks with the activist investor Elliott Investment Management, Align agreed to add three new directors, started a review of its strategy and operating model with a consulting firm, and raised its 2026 buyback plan to $400 million to $500 million. On October 28, 2026, Align said that Jennifer L. Davis, a former CEO of Procter & Gamble's health care business, will replace Joseph M. Hogan as CEO on December 31, 2026. For the gap to close, three things must be true. Clear Aligner volume must keep growing at mid-single-digit rates or better, including in North America. The non-GAAP operating margin must reach about 23.7% in 2026, as guided, and rise further after the operating model review. The review and the new CEO must show concrete cost savings and growth plans. The Q3 2026 report met the outlook for revenues and volume, and the non-GAAP operating margin was 24.4%. The Q4 report and the 2027 outlook in early 2027 are the main test. If these checks pass, the gap can close over the next three to six quarters. The main reason it may not close is a loss of share to lower-priced aligners.
- Risks
- Clear aligners face more competition, including lower-priced products. Align expects its 2026 Clear Aligner average price to be flat to slightly down. More price pressure can lower revenue growth and margins. Demand for orthodontic treatment depends on consumer spending, and many adult patients pay themselves. Imaging Systems and CAD/CAM Services revenues fell 7.6% in Q3 2026, because dentists bought fewer capital goods. A weak economy can slow both businesses. Align faces antitrust class actions and other lawsuits. At June 30, 2026, it had accrued $31.8 million for legal settlements, mostly for one antitrust class action, and it recorded a $38 million liability for UK VAT in Q2 2026. The European Commission also investigates whether Align linked its iTero scanners to Invisalign against EU competition rules. An adverse result can bring a fine and force changes to how Align connects scanners and aligners. The board, the chairman and the chief legal officer changed in 2026, and a new CEO takes over on December 31, 2026. An operating model review with a consulting firm and a restructuring plan are under way. Large changes can distract management, and the review may not give the expected savings.
- Balance sheet
- Cash: $1.1B Debt: $0.0M Net cash: $1.1B Undrawn credit line: $300M, to December 2027 Align has no debt and funds its operations with cash from operations. At September 30, 2026, cash and cash equivalents were $1,144.9 million, up from $1,102.6 million at June 30, 2026. Its $300 million unsecured revolving credit facility matures on December 23, 2027, and the full $300 million was available at September 30, 2026. In Q3 2026, Align bought back about 627,300 shares at an average price of $164.73, and $630.0 million remained under its $1.0 billion repurchase program at September 30, 2026. Align expects to buy back up to $300 million of shares in Q4 2026 and about $500 million in all of 2026. It expects 2026 capital expenditures of $125 million to $150 million. Interest cover is not shown, because Align has no debt. As of Sep 30, 2026.
- Checkpoints
- Oct 28, 2026: Q3 2026 earnings: aligner volume and margin. Passed. Watch: Revenues within the $1,000 million to $1,020 million outlook, Clear Aligner volume up mid-single digits and a non-GAAP operating margin near 24% pass; results below the outlook fail. Outcome: Revenues were $1,014.8 million, Clear Aligner volume rose 6.6% and the non-GAAP operating margin was 24.4%, but Align lowered its 2026 revenue outlook to about 2% growth. Jan 28, 2027 (estimate): Q4 2026 results, the operating model review and the new CEO's plan. Pending. Watch: A 2027 outlook for faster revenue growth than in 2026 and concrete savings from the review pass; growth below 3% or no clear plan fails.
- Recent events
- Oct 28, 2026: Align reported Q3 2026 results. Revenues rose 1.9% to $1,014.8 million, within the outlook of $1,000 million to $1,020 million. Clear Aligner volume rose 6.6% to 690.6 thousand cases, and Imaging Systems and CAD/CAM Services revenues fell 7.6%. GAAP EPS was $1.90 and non-GAAP EPS was $2.80. The non-GAAP operating margin was 24.4%. Align expects 2026 revenues of $4,110 million to $4,130 million, a non-GAAP operating margin of about 23.7% and about $500 million of share buybacks. It started a restructuring plan in Q3 2026 to reduce headcount and costs. Oct 28, 2026: Align said that the board appointed Jennifer L. Davis as CEO-elect and director from November 2, 2026, and as President and CEO from December 31, 2026. She was CEO of Procter & Gamble's health care business until June 2026. Joseph M. Hogan, CEO since 2015, retires as CEO on December 31, 2026, becomes a strategic advisor and stays on the board until June 2027. Aug 27, 2026: The board appointed Quentin Blackford as a director and increased the board to eleven members. Jul 29, 2026: Align reported Q2 2026 results. Revenues rose 4.3% to a record $1.06 billion, and Clear Aligner volume rose 7.4% to a record 691.8 thousand cases. Imaging Systems and CAD/CAM Services revenues fell 10.8%. GAAP EPS was $1.51, after a $38 million UK VAT liability, and non-GAAP EPS was $2.64. Align expected Q3 2026 revenues of $1,000 million to $1,020 million and kept its 2026 revenue growth outlook of 3% to 4%. Jul 29, 2026: After talks with Elliott Investment Management, Align said that it will add three new independent directors and review its strategy and operating model with a global consulting firm. It raised its 2026 share repurchase plan to $400 million to $500 million. Jul 6, 2026: Julie Coletti, Chief Legal and Regulatory Officer, resigned to join Illumina as Chief Legal Officer, effective August 1, 2026. Jun 30, 2026: The European Commission opened a formal antitrust investigation into Align. It examines whether Align abused a dominant position for Invisalign aligners, because Invisalign did not accept orders and scans from competing intraoral scanners. Align said that it will cooperate and that the opening of the investigation is a procedural step. Jun 17, 2026: C. Raymond Larkin, Jr. said that he will retire as Chairman on July 1, 2026, and leave the board on December 31, 2026. The board named Kevin Conroy, an independent director, as Chairman from July 1, 2026.