Trouble Ahead at 3D Systems Corporation Prints a Loss (DDD)

The next biggest thing ever comes around once every six months or so. These shifts in market sentiment can provide opportunities to profit in the short term for sure, but not many of them pan out to live up to the hype. Still, it’s a blast trying to find the next “story stock” that’s going to revolutionize an industry or change our daily lives.

Not too long ago, the hot topic was 3D printing. The technology was set to change manufacturing in the future. Rather than having to go to the store to pick something up, we’d just download the instructions and print what we needed right there in the comfort of our own home.

Personally, I understood the technology but I didn’t really buy into the idea. It may change how manufacturing is done but I doubt it’s going to change my daily life in any way.

So I’ve never been very bullish on the consumer 3D printing market. Judging by the recent analyst earnings estimate revisions on today’s Bear of the Day it looks like I’m not the only one to share the sentiment.

3D Systems Corporation (DDD) is a leading provider of 3D modeling, rapid prototyping and manufacturing solutions. Its systems and materials reduce the time and cost of designing products and facilitate direct and indirect manufacturing by creating actual parts directly from digital input. That’s a fancy way of saying the company makes 3D printers.

Here at Zacks, we’ve got a Zacks Rank #5 (Strong Sell) rating on the stock with Value and Momentum Style Scores of F. Negative earnings estimate revisions for the stock are coming on the heels of a disappointing earnings report where the company reported a 5 cent loss for the quarter versus consensus calling for a penny loss.

Over the last 30 days, two analysts have dropped their earnings estimates for the current year. The revisions have dropped our Zacks Consensus Estimate from a 16 cents per share gain for the year down to just 7 cents per share. The current quarter, which analysts originally saw coming in at 2 cents per share looks to be a breakeven quarter now.

We have the stock uniquely positioned in a vague computer manufacturing industry that includes Zacks Rank #3 (Hold) HP Inc (HPQ) and Lenovo Group Limited (ADR)(LNVGY).

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