Stockchase Opinions

Stockchase Insights 3D Systems DDD-N RISKY Mar 22, 2024

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research

DDD has been on a pretty steady downward trend since 2022 and is down 55% over the last year. Since 2021, DDD has seen revenues declining along with swinging to a net loss that became worse from 2022 to 2023. 3D printing has been around for quite a while now and it has very relevant applications in the manufacturing industry. Looking at the broader industry, there a 3D printing ETF ticker PRNT which has historically been flat outside of a big jump in 2021. 3D printing is definitely innovative and unique, but we are skeptical if the industry will ever take off from an investment standpoint as once expected. We are not sure on what the exact applications with AI would look like and there has not been any word on this as of yet. 
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DON'T BUY

Decided to break up during a bear market. He bought GXO-T 2 weeks ago. It had a good rally and he does not see a compelling case. If BXO-T dropped he would buy it at around $5. He did not agree with breaking it up in a market when people want a bigger company.

DON'T BUY

This company really had to change their strategy from focusing on retail buyers, to more industrial and business based. That has been successful, but it looks like it is going to take some time. Also, there have been new players coming into the market that are increasingly competitive. There is a lot of uncertainty around 3-D printing in general, and who is going to be the ultimate buyer. Also, if Hewlett-Packard (HPQ-N) enters the market, that is definitely going to hurt this company. There is just too much risk and uncertainty.

DON'T BUY

3-D printing is effectively the idea where if you need a new kidney, someone can go and print it for you. The whole idea of being able to print products and doing it quite cheaply is quite an interesting one. Longer-term, it really opens up the question of location of factories. Rather than having to be located in certain areas, can they be located near the consumer? The promise of 3-D is very, very good. However, the hype got way ahead of itself. He would like to see this company be a part of something else, which would make the promise of 3-D printing open up and be more accepted. He wouldn’t buy this here.

COMMENT

Very recently had a spike in the price. It has broken out through a resistance level, meaning there should be incremental buyers here, probably up into the $30-$35 level. Ultimately, this is still very much of a “show me” story to him. It is extremely volatile, so it doesn’t really fit what he does.

DON'T BUY

3D printing company. The technology is not taking off like most people predicted. When it takes off, these guys will be one of the leaders. But it may not get back to where it was. There are better plays right now.

SELL

Unfortunately, it had a big earnings miss. A very whippy stock. It can be a big pop or a big drop on earnings numbers. There is a lot of hype and expectations. Technically it has broken because of its bad earnings quarter, and it is going to face a long road up.

SELL
A dog. It's plunged from $70 to $5 and you'll be lucky to make a dollar or two.
HOLD
They got overheated. It was like a Reddit/meme stock for a while. He believes in this, so stick with it.
SELL
It's had a very big run and it's time to take profits. Sell.