what happened
Shares of industrial 3D printing supplies Stratasys (NASDAQ: SSYS), Desktop Metal (NYSE: DM), en 3D systems (NYSE: DDD) it crashed in harmony today. By the time the closing clock struck, Stratasys’s share was the lowest with a loss of 15%, followed by Desktop Metal, with 9.9% and 3D Systems, with 8.1%.
And oddly enough, it’s the share with the biggest loss that has the only news today.
Image Source: Getty Images.
Approximately
And that’s probably good news, too. This morning, Stratasys announced that it has acquired British, large-frame industrial stereolithography company RP Support Ltd. (RPS) to develop Stratasys’ polymer solution solutions. With the marketing of RPS’s Neo-series 3D printers worldwide, Stratasys predicts that by the end of this year, this acquisition will be ‘slightly attractive for revenue’ and will contribute to adjusted earnings per share.
Good news? Maybe, but it’s hard to name this good news. Even in the press release announcing the acquisition, Stratasys acknowledges that the total “global addressable” market for industrial stereolithography systems is only about $ 150 million and is growing at only about 10% per year. Indeed, RPS will have to seize a very large share of the market if it moves the Stratasys’ annual revenue stream of $ 538 million. In addition, if RPS’s business grows by only an average of 10% – or even slightly better than average – it will be more likely that Stratasys’ own total (analysis projected) growth rate will slow down by 30%, rather than accelerate. on.
On the plus side, Stratasys did not say how much he paid for RPS, meaning the number was not material. Just-just, this news feels pretty ‘meh’ to me.
Now what
In the same way, ‘meh’ news does not really explain why Stratasys’s shares are declining so much today – or why 3D Systems and Desktop Metal are following suit.
My guess? Investors are starting to feel nervous about their earnings.
3D Systems is earned on February 24 with the fourth quarter, and Stratasys reports a week later on March 1. Analysts have linked Stratasys only for a break-even quarter – far worse than the $ 0.18 a share it earned a year ago. And while 3D Systems told us last month that it might earn a profit, it could not.
As for the recent IPO Desktop Metal, it has not yet announced a earnings date. It’s logical to assume that bad news reported by the two leading names in 3D printing could also have an effect on Desktop Metal stocks, especially since analysts are not even too optimistic about the stock – predict a loss of $ 0.07 for the current quarter.
Since the only good news we saw in the sector today was not so great, it is understandable that investors decided to focus instead on the prospects of the potential bad news coming down on the pike.