On Dec 28, Zacks Investment Research downgraded
Align Technology Inc.
) to a Zacks Rank #2 (Buy) from Zacks Rank #1 (Strong Buy).
Why the Downgrade?
On Oct 17, Align Technology had reported third-quarter 2013
adjusted earnings of 40 cents per share, registering a steep rise
of 42.8% year over year. The results also surpassed the Zacks
Consensus Estimate by 33.3%. The company delivered a strong top
line as well, beating the revenue estimates.
Though Align Technology delivered impressive growth during the
quarter, persisting global challenges remain an area of concern.
Moreover, we believe the large competitive landscape might compel
the company to lower prices of some of its products going
forward. This can potentially impact growth prospects for the
company in the near term.
Furthermore, the general slowdown in the US economy can tamper
the future revenue figures. Patients will tend to defer dental
procedures, while dentists too will likely play spoilsport
delaying capital investments on intra-oral scanners.
Amidst such challenging circumstances, Align Technology expects
revenues in the range of $169.1−$173.1 million in the ongoing
fourth quarter of 2013, while in the year ago quarter it
registered revenues worth $143 million. The current Zacks
Consensus Estimate of $173 million remains at the upper end of
the guided range. Earnings per share are expected in the range of
41-43 cents compared with the Zacks Consensus Estimate of 43
The Zacks Consensus Estimate for 2013 moved north by 14.8% to
$1.47 per share over the last 90 days. The estimate for 2014 also
rose to $1.71 from $1.52 over the same period reflecting an
increase of 12.5%
Other Stocks to Consider
Investors interested in the medical industry can also consider
Cardinal Health, Inc
). While NuVasive sports a Zacks Rank #1 (Strong Buy), McKesson
Corp. and Cardinal Health carry the same Zacks Rank as Align
ALIGN TECH INC (ALGN): Free Stock Analysis
CARDINAL HEALTH (CAH): Free Stock Analysis
MCKESSON CORP (MCK): Free Stock Analysis
NUVASIVE INC (NUVA): Free Stock Analysis
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