Most 3D printing stocks shot up on Tuesday after one specific company reported a fantastic Q2. 3D Systems (NASDAQ: DDD), one of the leading 3D printing companies in the world, managed to beat most analysts’ expectations for its most recent quarter. What’s more, following the news, shares of 3D printing stocks continued to soar as social media traders on forums like Reddit decided to start buying up shares as well.
3D Systems reported that its revenue climbed to $162.6 million, more than 45% higher compared to last year. While industrial demand for 3D-related goods and services has declined, healthcare demand for 3D products has surged. Additionally, 3D Systems expects its profit margins to rise from 40% to 44% by the end of the year.
While 3D Systems has been doing great this year, it wasn’t always like that. Back in 2020, the company was struggling to find a serious, consistent buyer base for its products. During the pandemic, the company made the strategic decision to pivot to printing for healthcare and industrial markets. This includes 3d printed medical supplies as well as dental materials.
“Our second quarter performance reflected continued positive momentum, with results that greatly surpassed those of a year ago from both a revenue and profitability perspective. Perhaps even more importantly, we also saw double-digit revenue growth on a consecutive quarter basis, an important indicator of the momentum we are now experiencing,” said CEO Jeffrey Graves in a statement.
Shares shot up as much as 30.5% in response to the news. What’s more, other 3D printing stocks rose as well by association. Stratasys (NASDAQ: SSYS) is up 9.9%, Voxeljet (NASDAQ: VJET) up 3.0%, while ExoOne (NASDAQ: XONE) gained 5.0% on Tuesday.
For the most part, it was great news. What’s more, with Reddit traders eager to find the next hot “meme stock,” many jumped on the chance to buy up 3D Systems as shares were rising on the news. However, not everyone is as optimistic about the company.
Analyst Greg Palm at Craig-Hallum ended up downgrading the stock yesterday following its jump. His main argument is that its current price has been driven more by social media traders than actual, sustainable fundamentals. He downgraded the stock from a buy to a neutral hold, although he did raise the price target from just $29 per share to $37.
Most analysts covering 3D Printing stocks, in general, are incredibly optimistic about the industry. However, it seems many are more neutral when it comes to specific companies. 3D Systems has ten analysts providing coverage on the company’s stock. Eight of them have some sort of neutral rating, while two have some type of sell rating.
3D Systems Company Profile
3D Systems Corp provides comprehensive 3D printing and digital manufacturing solutions, including 3D printers for plastics and metals, materials, software, on-demand manufacturing services, and digital design tools. Its key end markets include healthcare, dental, aerospace, automotive and durable goods. It conducts business through various offices and facilities located throughout the Americas region, EMEA region, and APAC region; generating a vast majority of revenues from the US. – Warrior Trading News
