ALGN - Embedded Expectations Analysis - 2020 09 10
Align Technology, Inc. (ALGN:USA) currently trades above historical averages relative to UAFRS-based (Uniform) earnings, with a 70.5x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may have concerns about the potential of their digital platform, Invisalign treatment, and overall gross marginsSpecifically, management may lack confidence in their ability to execute the ADAPT program, improve overall gross margins, and sustain increased revenue in countries with higher prices. They may also be overstating the potential of imaging in treatment planning, their digital platform, and new partnership with Charli D' Amelio. Furthermore, they may lack confidence in the adoption of digital workflow around iTero scanners and general dentistry, and they may have concerns about the financial losses related to the exocad acquisition. Management may also have concerns about the sustainability of demand for Invisalign treatment, and the potential of their new and improved digital learning environment for their doctors
Align Technology is a medical device company engaged in the design, manufacture and marketing of Invisalign? clear aligners and iTero? intraoral scanners and services for orthodontics, restorative and aesthetic dentistry. The company's segments are: Clear Aligner, which includes the Invisalign System, a method for treating malocclusion based on a proprietary computer-simulated virtual treatment plan and a series of doctor-prescribed, custom manufactured, clear plastic, removable aligners; and Scanners and Services, which includes Intraoral scanning that enables the dental practitioner to create a 3D image of the patient's teeth (digital scan) using a handheld intraoral scanner.
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