Align Technology (ALGN) PT Raised to $175 at Morgan Stanley; Huge At-Home Ortho Opportunity

Morgan Stanley raised its price target on Align Technology (NASDAQ: ALGN) to $175.00 (from $150.00) while maintaining a Overweight rating, citing the at-home opportunity.

Analyst Steve Beuchaw has a strategic imperative to access an incremental ~150 million case doctor-directed at-home ortho opportunity globally that can grow the TAM by >10x.

Beuchaw said the company's core business opportunity of taking share in the 10 million case per year orthodontic market from a base of ~8%, is appealing and supports their base business valuation of $157 per share. However, this is small in comparison to the estimate of a 300 million case global prevalence pool for malocclusions treatable at-home with clear aligners.

"We estimate ALGN can capture 50% of ~350k at-home cases in the US in 2020 and 70% longer-term, which would contribute ~$50mn/13% of incremental cash flow by 2020," the analyst commented.

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