Will 3D Systems Print Money for Investors?
"Come on aboard, I promise you you won't hurt the horse
We treat him well, we feed him well
There's lots of room for you on the bandwagon"
-- "Bandwagon" by R.E.M., 1985
3-D printing may sound like science fiction, but 3D Systems (NAS: DDD) and Stratasys (NAS: SSYS) have already made it a reality. The next time you need a screwdriver, a golf club, or a custom-designed hip replacement, these guys make machines that let you just print them up and go to town. (I don't recommend performing hip-replacement surgery on yourself, but that's another story.)
Multidimensional-printing expert 3D Systems reports first-quarter earnings on Thursday. The 3-D printing bandwagon, alluded to in today's National Poetry Month tribute, is taking off. Should you climb aboard?
Wall Street doesn't quite know what to make of 3D Systems yet. Earnings estimates for this quarter range from $0.05 to $0.22 per share. The consensus average of $0.13 is a penny below the year-ago quarter's net income.
There's more agreement on the revenue line, with just an 11% difference between the lowest and the highest available estimate. The average target stops at $74 million, a 55% year-over-year jump.
The company is currently shifting its sales focus to a new generation of lower-cost printers. That's a crucial move toward the mainstream. Now you can get a build-it-yourself 3-D printer kit for as little as $1,400. One kilogram of plastic printing materials costs $79. That's a big change from the $10,000 systems of just three years ago, though it's still a bit pricey for your average consumer.
Both Stratasys and 3D Systems jumped last week as Stratasys announced a strategic buyout. That pre-earnings bounce may have taken some of the bounce out of 3D Systems' trampoline for the quarterly results, so it would probably take a large earnings surprise to move share prices very far. The stock has gained 51% over the past three months. Adding this volatile stock to your Foolish Watchlist lets you take action when share prices match the business promise. Get started, and then read up on how 3-D printing is about to rock your world.
At the time this article was published Fool contributorAnders Bylundholds no position in any of the companies mentioned. Check outAnders' holdings and bio, or follow him onTwitterandGoogle+. The Motley Fool owns shares of 3-D Systems.Motley Fool newsletter serviceshave recommended buying shares of Stratasys and 3-D Systems. The Motley Fool has adisclosure policy. We Fools don't all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.