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I am hoping someone can make a bear case before I go long.


https://seekingalpha.com/news/3348715-align-tech-q1-revenues...

Align Technology (NASDAQ:ALGN) Q1 results ($M): Revenues: 436.9 (+40.8%); Clear Aligner: 385.5 (+36.5%).

Net income: 95.9 (+834.0%); EPS: 1.17 (+999%); cash flow ops: 77.3 (+62.4%)

Invisalign case shipments: 272.2K (+31%).

Q2 Guidance: Revenues: $460M - 470M; Invisalign case shipments: 296K - 301K; EPS: $1.02 - 1.06.


Note: Earnings of 1.17 beat 1.07 estimate, for a 9.35% surprise.
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Considering that ALGN is my largest position at this time I can't help you with a bear case. At this time the only thing that could derail Align Technology is disruptive innovation. Clear aligners are in the process of disrupting a decades old technology. I had wire braces 65 years ago, it's a slow moving field! On the bull side I see that increasing world wide affluence is creating new markets for this product.

Why a bear case to go long?

Denny Schlesinger
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I like arguments from both sides. Then I decide.
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Denny, do you have any idea if ALGN sells its products through Dentsply Inc (XRAY)or do they sell directly to orthodontists?

And thanks for the answer.

I asked MF to start a Dentsply (XRAY) board.

Here's an intersting thing about XRAY:

This past Sunday, 6 May 18, they released earnings.

Consensus estimate was for .42 per share.

Actual Earnings were .45 per share.

The beat was 7.35% surprise.

And yet the stock dropped AND today's share price is now less than when Dentsply and Sirona merged to form what is an oligopoly in dental supplies.

That's why I am asking if ALGN is direct to Dentists/Orthodontists?
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p.s. XRAY has dropped almost 10% since earnings release this past Sunday.

I am hoping for some analyst upgrades on that earnings beat.

This is looking like a bottom to me, or, close to one.
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Denny, do you have any idea if ALGN sells its products through Dentsply Inc (XRAY)or do they sell directly to orthodontists?

I don't "know" but I doubt it. From their Yahoo profile, Dentsply sells stuff that dentists got to know in school while clear aligners have to be custom made for each patient. To me that sounds like a "sell direct" kind of product.

For what it's worth, I looked at XRAY some years ago and passed because I did not like their historic growth rate of under 10%.

https://invest.kleinnet.com/bmw1/stats20/XRAY.html

As for boards for individual companies, they get very little traffic. ALGN has 57 posts in 17 years!

Denny Schlesinger
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As for boards for individual companies, they get very little traffic. ALGN has 57 posts in 17 years!

I 'noticed' that... kind of surprised, too... whatever...

A remedy that possibility fits the bill (?):
https://www.fool.com/quote/nasdaq/align-technology/algn

I think (yours and others) comments over on the New Paradigm Investing board are also useful observations on the company.

Based on what I've learned about ALGN over the past 30 days here on TMF, I've entered a primary port contingent order to buy at the -9% price drop point for ALGN...

(It has hit the -9% price three times since last December, and is up handsomely from any one of the three hits.)
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Based on what I've learned about ALGN over the past 30 days here on TMF, I've entered a primary port contingent order to buy at the -9% price drop point for ALGN...

(It has hit the -9% price three times since last December, and is up handsomely from any one of the three hits.)


From November through April ALGN was in a trading range (225~285) but in May it broke out to the upside. You might not get a 9% drop any time soon. I bought my shares between late September and the end of January and it's currently my largest position.

We talked a lot about ALGN at the NPI board today.

Denny Schlesinger
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captainccs You might not get a 9% drop any time soon.

May be. But I've been following the technique for a couple of years now, and the results have seriously amazed me. Deceptively simple, in that time, it's failed twice, but succeeded more than a dozen times and counting. Not infrequently, fertile ground occurs when there has been a sharp run up and short term folks take their profits.

(Note: I'm looking for the 'exceptional' low drops DURING the trading day, NOT necessarily the final closing price. With the technique, I capture those events where we all say "If I had only known I could have bought at that level, I'D have bought in / added more!")

The time available for such buys is typically very short, not infrequently <<60 minutes. No way to capitalize on the opportunity by trying to react to news, rumor, etc. Selected targets 'obviously' have to be in the category "I want to own this company, no matter what"... or you could easily end up with something that really DOES have very negative news / events reported. It's happened to me only once. Remedy was to sell immediately and take my lumps.

Repeating earlier, the contingent order I've placed for ALGN is -9%, a point it has met or exceeded three times since December 4th last year. (Actually hit -12% that date.)
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May be. But I've been following the technique for a couple of years now, and the results have seriously amazed me. Deceptively simple, in that time, it's failed twice, but succeeded more than a dozen times and counting. Not infrequently, fertile ground occurs when there has been a sharp run up and short term folks take their profits.

I've used a similar technique on stocks that I thought had potential and it proved to work rather well as long as the stocks were in a trading range. Fast growers presented too many lost opportunities while falling stocks produced real losses. As they say, YMMV. ;)


Repeating earlier, the contingent order I've placed for ALGN is -9%, a point it has met or exceeded three times since December 4th last year. (Actually hit -12% that date.)

I read that in your earlier post but I still don't understand it entirely, did the price drop by 9% since December 4th last year or did you buy three times since then at under 9%? As I mentioned in my earlier post, ALGN was in such a trading range from November through April so the technique should have worked but now that it broke out to the upside, it should no longer work -- does not mean you can't try! )

Denny Schlesinger
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captainccs: did the price drop by 9% since December 4th last year

No, no, no... the percentage drop only pertains to THAT DAY'S INTRADAY LOW, compared to the closing price the previous trading day, 12/1. Not a longer time frame.

On December 4th, intraday, ALGN experienced a low of $222.74. Previous trading day's close (Dec 1) was $254.07. Intraday drop = -12.3%. A contingent order programmed to trigger at -9% would have fired. (At -9%; wouldn't get the full -12.3%, but I'm not greedy. HA.)

FWIW, ALGN finished closing on 12/4 at $225.80, so already would have seen a few bucks gain. And of course now it sits ~~$323 and change.
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OK, I finally understand why you need the "contingent" order. My previous broker had contingent orders but my current platform doesn't. This is an interesting option when accumulating a stock. Thanks!

Denny Schlesinger
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