Align Technology Earns High Rating from Value Investor Model

Align Technology Inc. receives a strong 57% rating based on Benjamin Graham's Value Investor strategy. Despite some failures in key financial metrics, its solid long-term EPS growth indicates potential for investors.

Date: 11-02-2025

AI Rating: 6

Detailed Investor Insights on ALIGN TECHNOLOGY, INC.

Align Technology, Inc. (ALGN) is assessed through a deep value methodology that highlights various financial metrics. The stock rates 57% based on its fundamentals and valuation, which suggests a moderate interest in the stock. A key takeaway from the report is its strong performance in long-term EPS growth, indicating that the company has effectively managed to enhance its earnings on a per-share basis over time, which is a positive signal for potential investor returns.

The report highlights a few specific points regarding financial assessment:

Long-Term EPS Growth: The stock is rated positively in this category, indicating that Align Technology has demonstrated solid long-term earnings growth. This is crucial as it reflects the company’s ability to increase its profitability consistently, fostering investor confidence.

However, it also notes some challenges:

Current Ratio: The company failed to meet this criterion, which could indicate potential liquidity issues. A low current ratio suggests the company may struggle to cover its short-term liabilities, which usually raises concerns for investors.
P/E Ratio: The failure here indicates that the stock may be overvalued relative to its earnings, suggesting that investors might want to consider this when evaluating the stock price compared to earnings potential.
Price/Book Ratio: Similar to the P/E ratio, a failure in this area raises a concern regarding valuation; a high price/book ratio indicates that the stock is expensive compared to its book value.

In summary, while Align Technology has strengths, particularly in long-term EPS growth, the liquidity and valuation concerns represented by the current ratio, P/E ratio, and price/book ratio could weigh on investor sentiment and stock performance going forward.

Stocks: ALGN