We have issued an updated research report on 3D Systems Corporation DDD on Mar 31, 2015. Of late, the company has been undertaking strategic initiatives to take 3D printing to a whole new level by expanding its reach and adaptability.
Consequently, 3D Systems has been forming strategic alliances with leading companies across various industries such as chocolates, toys and retail. This month, the company unveiled a state-of-the art 3D printed architectural structure called Bloom, which utilizes the company’s advanced ColorJet printing. Also, 3D Systems collaborated with Impression Solutions and Henry Schein to boost its distribution network.
Apart from this, 3D Systems has been executing strategic acquisitions to diversify its offerings, add synergistic technology and expand its domain expertise in operating markets. In 2014, the company concluded 10 business acquisitions, of which the major ones were the buyout of Simbionix, LayerWise, Medical Modeling, botObjects and Robtec. In Feb 2015, 3D Systems completed the purchase of Cimatron to enhance its product and technological development.
However, although such initiatives hold good for long-term growth, in the near term they generate high high research & development (R&D) and acquisition costs for the company. Such costs have been hampering the company’s financial health since the past few quarters.
Also, as 3D Systems operates in an extremely dynamic industry, it faces several negatives like rapid technological changes and alterations in user, customer requirements and the emergence of new standards and practices. Consequently, despite an improved demand scenario in fourth-quarter 2014, the company failed to reap the gains fully, owing to certain manufacturing and delivery constraints. This weighed on 3D Systems fourth-quarter earnings.
Echoing similar sentiments, over the last 30 days, the Zacks Consensus Estimate for 2015 and 2016 earnings per share declined by 4 cents and 2 cents, respectively to 73 cents and $1.06, respectively. The company currently carries a Zacks Rank #3 (Hold).
Other Stocks to Consider
Some better-ranked stocks in the industry include Apple Inc. AAPL, Amkor Technology, Inc. AMKR and Cirrus Logic Inc. CRUS. All stocks carry a Zacks Rank #1 (Strong Buy).
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