Align Technology Inc (ALGN) stock analysis
Close on Nov 12, 2026Market cap $11.86BP/E 24.3Yield –
StockData Score
Prices as of Nov 11, 2026How the score works
Solid17 of 30 checks passed
Align Technology passes 17 of the 30 checks behind our score; 5 could not be run for lack of data and count as not passed. Each dot in the shape is one check — hover it for the numbers.
- Valuation
- 6/6
- Growth
- 2/6
- Past performance
- 3/6
- Financial health
- 6/6
- Dividend
- 0/6
What stands out
Margin of safety over 20%
The price is 24.3% below fair value, more than the 20% cushion we look for.
Trading below fair value
The share price of $172.08 is below our fair value estimate of $227.37.
Return on capital over 10%
Return on invested capital was 15.5%, above the 10% that usually covers the cost of capital.
No debt
Align Technology has no borrowings on its latest balance sheet.
What to watch
Return on equity under 15%
Return on equity was 11.9% over the last twelve months and averaged 13.3% over five years; we look for 15% on both.
Earnings shrank over 5 years
Net income shrank 25.4% a year on average over the last five fiscal years.
Revenue growing under 10% a year
Revenue grew 2.6% a year over the last three fiscal years, short of the 10% we look for.
EPS growing under 10% a year
Diluted EPS grew 7.0% a year over the last three fiscal years.
Valuation6/6
P/E below its 5-year median
Align Technology's P/E of 25.0 is below its own 5-year median of 36.1.
P/E below the industry
Align Technology's P/E of 25.0 is below the Surgical, Medical, and Dental Instruments and Supplies median of 27.7.
EV/EBITDA below its 5-year median
Align Technology's EV/EBITDA of 12.9 is below its 5-year median of 19.5.
P/B below the industry
Align Technology's price-to-book of 2.84 is below the Surgical, Medical, and Dental Instruments and Supplies median of 3.22.
Trading below fair value
The share price of $172.08 is below our fair value estimate of $227.37.
Margin of safety over 20%
The price is 24.3% below fair value, more than the 20% cushion we look for.
Growth2/6
Revenue growing under 10% a year
Revenue grew 2.6% a year over the last three fiscal years, short of the 10% we look for.
EPS growing under 10% a year
Diluted EPS grew 7.0% a year over the last three fiscal years.
Earnings growth accelerating
Net income grew 30.0% over the last twelve months, against a 5-year average of -25.4% a year.
Growing slower than the industry
Revenue grew 4.4% over the last twelve months; the Surgical, Medical, and Dental Instruments and Supplies median is 11.0%.
Guidance lowered
Align Technology lowered its 2026 Systems & Services revenue growth outlook on Jul 29, 2026.
Gross margin improving
Gross margin was 69.1% over the last twelve months, against 68.4% a year earlier.
Past performance3/6
Return on equity under 15%
Return on equity was 11.9% over the last twelve months and averaged 13.3% over five years; we look for 15% on both.
Return on capital over 10%
Return on invested capital was 15.5%, above the 10% that usually covers the cost of capital.
Return on equity above the industry
Align Technology's return on equity of 11.9% is above the Surgical, Medical, and Dental Instruments and Supplies median of -31.3%.
Earnings shrank over 5 years
Net income shrank 25.4% a year on average over the last five fiscal years.
Net margin below its 5-year average
Net margin was 11.8% over the last twelve months, against a 5-year average of 12.3%.
Net margin above the industry
Align Technology's net margin of 11.8% is above the Surgical, Medical, and Dental Instruments and Supplies median of -14.1%.
Financial health6/6
No debt
Align Technology has no borrowings on its latest balance sheet.
Debt not rising
With no debt today, leverage cannot have risen.
Debt covered by cash flow
There is no debt to cover.
Interest well covered
No meaningful interest expense to cover.
Short-term assets cover short-term debts
Current assets are 1.42 times current liabilities.
Low bankruptcy risk
The Altman Z-score is 4.98; above 3 is the safe zone and below 1.8 the distress zone.
Dividend0/6
No dividend
Align Technology has not paid a dividend in the last twelve months.
Yield against Treasuries
No dividend.
Yield against the market
No dividend.
Dividend stability
No dividend.
Earnings cover
No dividend.
Cash-flow cover
No dividend.
Fair value
How we estimate itOur estimate per share
$227.37
The share price is 24% below this estimate.
| Method | Multiple used | Own 5Y median | Industry median | Value per share | Weight |
|---|---|---|---|---|---|
| P/E | 31.9× | 36.1× | 27.7× | $219.43 | 47% |
| EV/EBITDA | 18.1× | 19.5× | 16.7× | $234.71 | 41% |
| P/B | 3.9× | 4.5× | 3.2× | $233.40 | 12% |
| Earnings powerleft out, too far from the others | 13.1% cost of equity | – | – | $62.82 | – |
| Fair value | $227.37 | 100% | |||
Valuation over time
Using the earnings and balance sheet published at each date, not today's.
- P/E at month end
- Own 5-year median 36.1
- Surgical, Medical, and Dental Instruments and Supplies median 27.7
An estimate from reported numbers and market multiples, not a price target or investment advice. It can be far off for companies whose profits are about to change sharply.
Market risk
From the past year of daily prices.
Liquidity
Low risk
- Average value traded per day
- $174.05M
- Value traded per 1% price move
- $91.19M
Downside
Medium risk
- Typical loss in a bad month
- 15.7%
- Volatility (annualized)
- 40%
- Sharpe ratio, 1 year
- 0.50
- Beta to the S&P 500 (5Y)
- 1.65
Typical bad-month loss, week by week
Margins
Share of revenue, fiscal years 2011 to 2025
Gross margin
Operating margin
Net margin
Growth rates
Compound annual growth to fiscal 2025
| Per year | 1 year | 3 years | 5 years | 10 years | Five-year pace |
|---|---|---|---|---|---|
| Revenue | +0.9% | +2.6% | +10.3% | +16.9% | |
| Gross profit | -3.1% | +1.0% | +9.0% | +15.5% | |
| Operating income | -10.2% | -5.3% | +7.1% | +11.2% | |
| Net income | -2.6% | +4.3% | -25.4% | +11.0% | |
| EPS, diluted | +0.5% | +7.0% | -24.1% | +12.3% | |
| Free cash flow | -21.2% | +21.0% | -0.7% | +10.3% |
Returns and balance sheet
10 fiscal years. Hover a measure to see how it is calculated.
| Measure | FY2016 | FY2020 | FY2025 | Trend |
|---|---|---|---|---|
| Return on equity | 20.5% | 77.5% | 10.4% | |
| Return on assets | 14.8% | 48.5% | 6.6% | |
| Current ratio | 2.69 | 1.40 | 1.36 | |
| Inventory turnover | 11.4× | 5.6× | 5.5× | |
| Capex to revenue | 6.5% | 6.3% | 2.5% | |
| Diluted shares | 81M | 79M | 73M |
Where the cash went
Fiscal 2021 to 2025, five years combined
Align Technology generated $3.86B from operations and spent $3.31B on capital expenditure, dividends and share buybacks. 33% of that went back into the business.
DuPont analysis
Return on equity split into margin, efficiency and leverage
| Fiscal year | Net margin | Asset turnover | Equity multiplier | Return on equity |
|---|---|---|---|---|
| FY2025 | 10.2% | 0.65× | 1.58× | 10.4% |
| FY2024 | 10.5% | 0.65× | 1.64× | 11.3% |
| FY2023 | 11.5% | 0.64× | 1.66× | 12.3% |
| FY2022 | 9.7% | 0.63× | 1.65× | 10.0% |
| FY2021 | 19.5% | 0.73× | 1.57× | 22.5% |
| FY2020 | 71.8% | 0.67× | 1.60× | 77.5% |
| FY2019 | 18.4% | 1.06× | 1.75× | 34.1% |
| FY2018 | 20.4% | 1.03× | 1.59× | 33.3% |
| FY2017 | 15.7% | 0.93× | 1.48× | 21.5% |
| FY2016 | 17.6% | 0.85× | 1.38× | 20.5% |
Piotroski F-Score
Nine tests of profitability, balance sheet and efficiency, fiscal 2025 against fiscal 2024
- ProfitableNet income above zero$410.35M
- Cash generatingOperating cash flow above zero$593.22M
- Return on assets improvedROA up on the prior year6.9% → 6.6%
- Earnings backed by cashOperating cash flow above net income$593.22M vs $410.35M
- Less leverageLong-term debt to assets fell– → –
- Better liquidityCurrent ratio rose1.22 → 1.36
- No dilutionShare count did not rise75M → 73M
- Gross margin improvedGross margin up on the prior year70.00% → 67.19%
- More efficientAsset turnover rose0.66 → 0.65
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