Tag Archives: Dow Jones
There are a small number of public companies in the 3D printing industry today. The leading stocks are 3D Systems (NYSE:DDD), Stratasys (NASDAQ:SSYS), and Proto Labs (NYSE:PRLB). The chart above shows a 6-month comparison of this aggregate 3D printing portfolio vs. the S&P, Dow Jones, and NASDAQ. 3D printing names are up over 180%.
The 3D printing industry, also known as additive manufacturing and rapid prototyping, is at an inflection point.
Where to Invest?
For those looking to consider an investment in 3D printing stocks, Seeking Alpha’s analysis of the leading companies can be helpful.
First a reality check on the current state of the market.
Unfortunately the concept has limited commercial production capabilities and material challenges. Over time, these will naturally become less and less of a problem. For now though, several sectors such as aviation parts and medical devices can benefit greatly from the ability to RP. Not to mention, any wealthy person that wants to make their own iPhone case at home.
Then an analysis of each stock. Excerpts below:
3D Systems is leading the 3D printing market, but unfortunately investors missed the golden opportunity to buy back at the end of December when the stock still traded around $15. It now fetches over $30.
With a forward PE of 23, the stock trades roughly in line with the expected growth rate. While not cheap, it isn’t expensive and actually provides a solid earnings profile unlike most of the recent IPOs in the hot sectors of social media and cloud computing.
Stratasys provides another option in 3D printing, but the stock has likewise more than doubled since the lows back in October of last year. The company recently released the Mojo 3D Printer which is the market’s lowest-priced professional-grade complete 3D printing system priced at $9,900.
This stock trades at a richer valuation than 3D Systems with a forward PE of over 30. The company also only reported 30% revenue growth for Q112 while analysts only forecast 15% long term growth.
The recent announced merger with Objet is expected to launch Stratasys into a leadership position in the 3D Printing market. The combined company will rival the $1.5B market cap of 3D Systems along with the revenue size.
Proto Labs is an alternative investing option in 3D rapid prototyping and manufacturing short-runs of real parts. The company went public back in February, but the stock appears to have a similar pricey multiple as the 3D printing sector.
The company reported 34% revenue growth and a solid 25.5% operating margin. At a forward PE of 29, the company trades in the range of its long term growth rate. With revenue expectations of around $127M for 2012, the company remains relatively small.
Read the full analysis at Seeking Alpha.
Disclaimer: Please consult a financial advisor before making any investment decisions.