Align Technology, Inc.
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
Align Technology remains a hold as quarterly revenue growth accelerates — Q1 2026 +6.2% YoY and Q2 2026 +4.3% YoY — with four consecutive EPS beats including a 14.2% surprise in Q1 2026, yet the business has not restored peak profitability: FY2025 EPS of $5.65 sits well below the FY2021 peak of $9.69, gross margin compressed to 68.3% from 74.3% over that span, and Q2 2026 operating income of $123M declined sequentially from $173M in Q1 2026.
The stock at $146.78 trades at a 25.5x trailing PE — roughly 64% below the peer median of 71.8x — with a clean balance sheet ($114M debt vs $4.05B equity) and 12.2% FCF margin, but technicals are weak with price below both the 50-day ($163.10) and 200-day ($170.77) moving averages and an RSI of 39.1. New institutional interest from Nykredit ($74M) and CPPIB alongside a modestly positive smart-money score of 0.00 as of Q2 2026 is encouraging, but insider net selling of $4.6M over 24 months and persistent margin pressure warrant patience before turning constructive.
What could go wrong
- Margin compression continues. Gross margin fell from 74.3% in FY2021 to 68.3% in FY2025 and operating margin from 24.7% to 15.3%; Q2 2026 operating income of $123M declined sequentially from $173M in Q1 2026, suggesting cost or mix pressure is intensifying rather than stabilizing.
- Consumer spending weakness. CFO Morici acknowledged a challenging consumer environment at the September 2026 Baird conference; Invisalign is an elective, consumer-facing product vulnerable to discretionary spending cuts.
- Technical breakdown deepens. Stock at $146.78 is below both the 50-day MA ($163.10) and 200-day MA ($170.77) with RSI at 39.1; a break below recent lows could trigger further institutional selling.
- Insider selling signal. Net insider selling of $4.6M over 24 months, including CEO Hogan selling 16,107 shares at $190.02 on 20 Feb, suggests limited insider conviction at recent prices.
What would change my mind
Where this comes from: fundamentals · quarterly results · peer comparison · technicals, 25 Sep. Orin's read on ALGN; not advice.
How has the share price moved?
Up 12.0% over twelve months, from $135.65 on 27 Oct 2025 to $151.95 at the Tue 27 Oct 2026 close. Its highest close in that time was $197.51 on 11 Feb 2026; the last close is 23.1% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 6.3M, on 24 Nov 2025).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All ALGN filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $745.4M | 0.0% |
| Vanguard Capital Management | $742.3M | 0.0% |
| FMR | $684.8M | 0.0% |
| Capital World Investors | $577.2M | 0.1% |
| Goldman Sachs Group | $568.8M | 0.0% |
| Vanguard Portfolio Management | $528.2M | 0.0% |
| State Street | $431.5M | 0.0% |
| Geode Capital Management | $378.2M | 0.0% |
| Invesco | $238.4M | 0.0% |
| Morgan Stanley | $171.0M | 0.0% |
82 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 66 Form 4 filings; open-market trades net −$508K. Of the 50 on hand, 2 were open-market purchases and 1 a sale — the rest are grants, option exercises and tax withholding.
Ask Orin about ALGN
Orin answers questions about ALGN from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 26.4× its last 12 months of profit (Tue 27 Oct close) — lower than in all 5 of its last 5 fiscal years (middle 45.6×); the typical Healthcare company on the NASDAQ is at 20.8×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 26.4×below usual | 45.6× | 20.8× |
| P/S | 2.61×below usual | 4.42× | — |
| EV/EBITDA | 12.5×below usual | 20.1× | — |
| P/B | 2.6× | — | — |
- P/B: no usual level — it ran from 2.8× to 14.3× over its last 5 fiscal years, so a middle value says little.
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $193 (from $162 to $215) — 27% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$193
$162 – $215 · +27% against the last close
- 7 buy or overweight
- 5 hold
- 0 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 26.4× its last 12 months of profit. Only 1 of the 1 companies it is compared to made a profit (RVTY 77.1×), so there is no typical P/E.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| ALGNAlign Technology, Inc. | $11B | 26.4× | 12.5× | 66.5% | 10.0% | 10% |
| RVTYRevvity, Inc. | $18B | 77.1× | 26.6× | 52.1% | 8.2% | 3% |
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 26.4× its last 12 months of profit (Tue 27 Oct close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now26.4×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Healthcare companies on the NASDAQ were priced at a typical 20.8× their yearly profit (Tue 27 Oct close).
- Now20.8×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $98 a share — 35% below the $152.44 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $98 | 35% below $152.44 |
| Levered | $94 | 38% below $152.44 |
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.