Medical - Devices · NASDAQ
Current Price
$178.40
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on Align Technology, Inc. with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
Open DCF Calculator for ALGNAlign Technology, Inc., a medical device company, designs, manufactures, and markets Invisalign clear aligners and iTero intraoral scanners and services for orthodontists and general practitioner dentists, and restorative and aesthetic dentistry. It operates in two segments, Clear Aligner; and Scanners and Services. The Clear Aligner segment consists of comprehensive products, including Invisalign comprehensive treatment that addresses the orthodontic needs of teenage patients, such as mandibular advancement, compliance indicators, and compensation for tooth eruption; and Invisalign First Phase I and Invisalign First Comprehensive Phase 2 package for younger patients generally between the ages of seven and ten years, which is a mixture of primary/baby and permanent teeth. This segment's non-comprehensive products comprise Invisalign moderate, lite and express packages, and Invisalign go; and non-case products include retention products, Invisalign training fees, and sales of ancillary products, such as cleaning material, and adjusting tools used by dental professionals during the course of treatment. The Scanners and Services segment offers iTero scanner, a single hardware platform with software options for restorative or orthodontic procedures; restorative software for general practitioner dentists, prosthodontists, periodontists, and oral surgeons; and software for orthodontists for digital records storage, orthodontic diagnosis, and for the fabrication of printed models and retainers. This segment also provides computer-aided design and computer-aided manufacturing services; ancillary products, such as disposable sleeves for the wand; iTero model and dies; third party scanners and digital scans; Invisalign outcome simulator, a chair-side and cloud-based application for the iTero scanner; Invisalign progress assessment tool; and TimeLapse technology, which allows doctors or practitioners to compare a patient's historic 3D scans to the present-day scan. The company sells its products in the United States, Switzerland, China, and internationally. Align Technology, Inc. was incorporated in 1997 and is headquartered in Tempe, Arizona.
ROIC (TTM)
9.2%
ROE (TTM)
10.7%
FCF Yield
5.61%
Based on trailing twelve-month data, ALGN shows a free cash flow per share of N/A and a ROIC of 9.2%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 5.61% are important context metrics when evaluating ALGN's stock valuation relative to peers.
The intrinsic value of ALGN depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether ALGN is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $178.40. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on Align Technology, Inc.: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Medical - Devices industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting ALGN's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Align Technology, Inc., this means projecting how much free cash flow the Medical - Devices will produce over the next 5-10 years, then discounting those amounts to today's dollars. ALGN's ROIC of 9.2% shows moderate capital returns.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For ALGN, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
