ALGN vs. MMSI: Which Stock Should Value Investors Buy Now?

By Zacks Equity Research | May 27, 2025, 11:40 AM

Investors with an interest in Medical - Dental Supplies stocks have likely encountered both Align Technology (ALGN) and Merit Medical (MMSI). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Align Technology and Merit Medical are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. Investors should feel comfortable knowing that ALGN likely has seen a stronger improvement to its earnings outlook than MMSI has recently. But this is just one piece of the puzzle for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

ALGN currently has a forward P/E ratio of 16.57, while MMSI has a forward P/E of 28.45. We also note that ALGN has a PEG ratio of 1.48. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. MMSI currently has a PEG ratio of 2.77.

Another notable valuation metric for ALGN is its P/B ratio of 3.30. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, MMSI has a P/B of 3.95.

Based on these metrics and many more, ALGN holds a Value grade of B, while MMSI has a Value grade of D.

ALGN is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that ALGN is likely the superior value option right now.

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Align Technology, Inc. (ALGN): Free Stock Analysis Report
 
Merit Medical Systems, Inc. (MMSI): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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