Know Who To Trust: Did you BUY DDD Based on These Analysts’ Recommendations?
Two-dimensional printing is so 2013.
Three-dimensional printing companies are starting to get noticed for their unique technology and innovative products. One such 3D printing company, 3D Systems (DDD), developed stereolithography and the STL format and, over the years, has been growing its arsenal of products.
Some analysts were intrigued by these 3D printing ventures and two low ranked analysts recently recommended BUY DDD. However, a day after they advised to BUY DDD, the stock took a dive.
Analyst Sherri Scribner of Deutsche Bank recommended BUY DDD, noting the Consumer Electronics Show where the company showcased its offerings. “DDD has introduced a substantial number of new products and services at EuroMold and CES over the past month and a half. In addition, the company has been active this quarter with acquisitions, including The Sugar Labs (edible food), Figulo (ceramics), Village Plastics and Xerox’s Oregon-based solid ink team.” Because of new products and recent acquisitions Sherri believed the the company would see, “additional revenue growth”. However, Sherri has already lost -1.4% over S&P-500 based on this recommendation and with an average -0.6% return over S&P-500 this is no big surprise. Sherri is ranked 1469 out of 2337 analysts with a 50% success rate.
RBC capital analyst Amit Daryanani, ranked 1552 out of 2337 analysts, also recommended BUY DDD, noting its diverse product line, “One of the reasons we think DDD will outpace industry growth and maintain its industry leadership at least through 2015 is the fact that it has the most diverse product offering when it comes to printing technology.” And he is also a fan of their frequent acquisitions that add value to the company, “We think the ability to add strategically to the portfolio inorganically is a key component to DDD’s improving margin and revenue profile as we believe every acquisition is completed with the intention of adding differentiating technology, expanding DDD’s geographic reach and capitalizing on key initiatives.” Amit has a 44% success rate and has a -0.6% average return over S&P-500.
According to Dan Burrows of InvestorPlace, 3D printing company Stratasys (SSYS) was slammed after it forecasted that its full-year earnings would miss Wall Street’s estimates. And another company ExOne (XONE) had similar news, “XONE stock took a beating after ExOne slashed its revenue guidance.” Both Sherri and Amit did not predict that the futures of other 3D printing companies would effect the entire sector, which is now in “freefall”, causing DDD to fall from $91.88 to $85.67.
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