On March 17, I made a bullish call on Israeli 3D printing firm Nano Dimension (NASDAQ:NNDM). Of course, the market had to mock me by immediately sending the NNDM stock price lower. Does this mean that I’m abandoning my bright outlook today?
Not at all. I searched long and hard for legitimate reasons why the share price would drop. And, I didn’t find anything genuinely wrong with Nano Dimension.
If anything, a drop in the NNDM stock price should make it more attractive to bargain hunters. For folks who’ve been sitting on the sidelines with cash, you could be looking at an ideal entry point right now.
There’s no guarantee that the stock will stage a full recovery. Yet, if you believe in the company and in the future of the 3D printing industry, you might decide that there’s a rare opportunity here.
A Closer Look at NNDM Stock
As I alluded to earlier, there’s been a short-term pullback in NNDM stock. I made a bullish recommendation in mid-March when the share price was around $11, but by April 1, it had declined to $8.33.
There might actually be the potential for a share-price doubling here. As recently as Feb. 9, the stock reached a 52-week high of $17.89.
Besides, we should maintain a long-term perspective here. It was just a year ago when NNDM stock was trading at just 65 cents.
In other words, this stock is capable of making outsized price moves. Patience is the key here — and it’s much easier to be patient if you believe that the 3D printing market has room to grow.
Anticipating the Expansion
I wouldn’t go so far as to call an investment in 3D printing fail-safe. Yet, the data does seem to suggest that the expansion of this particular market segment is inevitable.
According to research firm Statista, the global market for 3D printing products and services is expected to exceed $40 billion by the year 2024. Not only that, but it’s forecast to grow at a compound annual growth rate (CAGR) of 26.4% between 2020 and 2024.
Nano Dimension collected some data points from various sources on the projected trajectory of the 3D printing industry. The numbers vary, but they all indicate a very strong growth rate:
- IDTechEX: The total 3D printed electronics market “will be worth $2.3 billion by 2029.”
- DataM Intelligence: The 3D printed electronics market size is “expected to reach $592 million in 2021 and up to $2.4 billion by 2025.”
- Transparency Market Research: The global 3D printed electronics market “is expected to expand at a CAGR of 44.46%
from 2018 to 2026, reaching US$ 3,915.0 million by the end of the
forecast period.”
Pick a statistic — any statistic! — whichever one you choose, there’s no denying that Nano Dimension could be at the ground floor of a highly lucrative market segment.
Watch That Balance Sheet
Even if you’re anticipating robust growth in the global 3D printing industry, it’s essential to focus on companies with firm capital positions.
Thankfully, Nano Dimension meets that criterion. Not long ago, the company reported $1.97 million in fourth-quarter 2020 revenues, as well as $3.399 million in revenues for full-year 2020.
On top of that, Nano Dimension CFO Yael Sandler offered encouraging insights into the company’s fiscal health.
“We ended 2020 with a strong balance sheet and $671 million in cash and bank deposits, thanks to the equity offerings we concluded during the year, and we have strengthened it even more to a balance of nearly $1.5 billion as of the end of February 2021,” Sandler stated.
Chairman and CEO Yoav Stern said that “war chest” and the company’s technology, makes Nano Dimension “extremely well positioned for growth.” His comments accompanied this week’s announcement of the hiring of a new company president, Zivi Nedivi. One bit jumped out from that press release: The new president’s got growth company experience on a global scale.
The company has demonstrated its ability to conserve cash while generating consistent revenues. Personally, I’m excited to track the progress in its upcoming fiscal reports throughout 2021.
The Bottom Line
Could NNDM stock get back to its February high point? It’s certainly possible, though patience will be the key for successful investors.
And given Nano Dimension’s superior capital position, the share price’s turnaround could happen surprisingly soon.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article.
David Moadel has provided compelling content – and crossed the occasional line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.
