Established players in the 3D printing market like Stratasys (SSYS) and 3D Systems (DDD) may expect increased competition from Voxeljet. The German 3D printing company filed for an initial public offering (IPO) with the U.S. Securities and Exchange Commission (SEC). Reportedly, the company is expected to raise approximately $100 million from the IPO.
Although Voxeljet is relatively smaller than its publicly-traded peers (Stratasys and 3D Systems) with revenues of $11 million, its portfolio boasts 170 U.S. and international patents and applications. Moreover, its clientele includes the likes of 3M (MMM), BMW, Daimler and Ford (F).
The 3D printing market presents a favorable long-term opportunity. According to the 2013 study by Wohlers Associates in 3dprintingindustry.com, 3D printing is expected to become a viable alternative across several market segments. The research firm expects this industry to continue to show double-digit growth over the next few years.
Thus, Wohlers Associates believes that the sale of 3D-printing products and services will reach $6 billion worldwide by 2017. The industry is expected to touch $10.8 billion in revenues by 2021.
The initial years were tough for the industry as it took 20 years to reach the $1 billion mark. However, the industry touched the $2.0 billion mark In the next five years. It is expected to double again and reach $4 billion by 2015.
We believe that Stratasys and 3D Systems are well equipped to continue on the growth path due to the strong growth prospects in the market.
Separately, Stratasys’ shares have enjoyed an outstanding run with returns of 66.4%, while 3D Systems’ shares have increased a stupendous 119.2% over the past year. We believe that the recent capital infusion through Stratasys’ public offering is a sign that investors are also bullish on the future prospects of the 3D-printing industry as well as the company.
Currently, Stratasys carries a Zacks Rank #3 (Hold), while 3D Systems has a Zacks Rank #5 (Strong Sell).
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