UPDATE: Stifel Nicolaus Initiates Align Technology at Buy on EPS Reacceleration

Stifel Nicolaus initiated coverage on Align Technology ALGN with a Buy rating and a $32 price target. Stifel Nicolaus commented, "Admittedly, EPS growth is likely to be suppressed in 1H13 due to difficult comps and near-term spend (purchase of APAC distributor). However, we expect a quick payoff on the investments and point to our estimated 2H13 y/y EPS growth of 40%. Once investors get comfortable that EPS is poised to meaningfully accelerate, multiple expansion will quickly follow. Despite the 3Q12 earnings disappointment, we believe Align's fundamentals remain intact. Specifically, our doctor diligence points to the potential for 2013 case volume upside, competition continues to flounder and Align's cash flow remains strong (YE net cash per share of $6)." Align Technology closed at $26.03 on Wednesday.