Align Technology (ALGN) has wrapped up FY 2025 with Q4 revenue of US$1.0 billion and Basic EPS of US$1.89, setting the tone for how investors parse both the latest quarter and the trailing twelve month picture. Over recent quarters, the company has seen revenue shift from US$979.3 million in Q1 2025 to US$1.0 billion in Q4, while Basic EPS moved from US$1.27 to US$1.89, giving investors a clear view of how the top line and per share earnings are tracking through the year. With a trailing twelve month net profit margin of 10.2% sitting just below last year’s 10.5%, the story now is less about headline growth and more about how consistently the business can defend its profitability.

See our full analysis for Align Technology.

With the latest numbers on the table, the next step is to line them up against the widely followed earnings narratives to see which views hold up and which might need a rethink.

TTM earnings at US$410 million alongside 10.2% margin

• On a trailing twelve month basis, Align reported US$4.0b in revenue and US$410.4 million in net income, which works out to a 10.2% net profit margin compared with 10.5% a year earlier.
• What stands out against a more bullish view is that, even though earnings are forecast to grow about 15.7% per year in line with the US market, the last five years show earnings declining about 21.6% per year. This creates a tension between the forward growth story and the multi year earnings track record.
  • Supporters of a bullish angle often point to the current 10.2% margin and US$410.4 million of trailing earnings as a solid base, yet the margin is lower than the 10.5% level cited for the prior year.
  • That contrast between a positive 15.7% earnings growth outlook and a 21.6% annual earnings decline over five years means the long term data does not fully back a simple bullish narrative centered only on earnings momentum.

Analysts who want to see how that mixed earnings picture feeds into long term storylines can check out the broader community narratives on Align, which set these numbers in a wider context. 📊 Read the full Align Technology Consensus Narrative.

Revenue forecasts at 5% per year trail US market growth

• The data describes Align’s revenue as growing at about 5% per year in recent periods, compared with a 10.3% annual revenue growth forecast for the broader US market. This means topline growth is expected to run at roughly half the market pace.
• Bears argue that slower revenue growth makes it harder for Align to sustain profit expansion, and the figures give them some support because the 10.2% trailing net margin is slightly below the 10.5% level a year earlier while revenue growth is also running below the 10.3% market benchmark.
  • Critics highlight that when revenue is only growing around 5% per year, there is less room for error if costs rise, which can show up in small margin shifts like the move from 10.5% to 10.2%.
  • The gap between Align’s 5% revenue growth and the 10.3% US market forecast reinforces the bearish concern that the company’s topline may not be keeping pace with peers even as investors focus on earnings growth forecasts.

P/E of 30.7x vs peers and DCF fair value gap

• Align trades on a P/E of 30.7x, slightly above both peer and industry averages at 30.2x and 30.6x, while a DCF fair value of about US$245.69 sits above the current share price of US$175.62. This implies a gap between that model and the market price.
• What is interesting for valuation focused investors is how this setup tests both bullish and bearish takes at the same time, because the modestly higher P/E can look demanding while the DCF fair value suggests more room in the price than the multiple alone might imply.
  • Supporters of a more optimistic stance can point to the DCF fair value of US$245.69 being above the current US$175.62 share price as indicating that, on that model, the stock trades below its estimated value even though the P/E is a little above peers.
  • On the other hand, skeptics can point out that with five year earnings declining about 21.6% per year and revenue growth described at 5% per year, paying a 30.7x P/E that is above the 30.2x and 30.6x benchmarks might still feel demanding if those forecasts do not play out as expected.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Align Technology's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

Align’s slower 5% revenue growth relative to the 10.3% US market forecast, combined with earnings declining about 21.6% per year over five years, points to softer momentum.

If that sluggish growth and the 30.7x P/E leave you questioning the upside, take a quick look at 55 high quality undervalued stocks, which may offer more compelling value setups right now.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.