Following discussions with Stratasys, Ltd. SSYS's chief financial officer Erez Simha, Brean Capital’s Ananda Baruah said in a report that management is optimistic about the market potential as well as the desire for the company's solutions.
Analyst Baruah added, however, that management sees no change in the current revenue environment and believes “the next revenue growth catalysts could be the initial contribution of SSYS's vertical solution approach by the end of '17, as well as the commercialization of its recently announced production platforms hopefully in '18.”
Market Opportunity And Pipeline
Management expressed optimism not only regarding FDM and Polyjet but also the upcoming product pipeline, and it believes the existing portfolio of hardware, software and materials allow the company “a very solid base from which to continue working with key partners in the focus markets of aerospace, automotive, and healthcare,” Baruah noted.
Growth Catalysts
The analyst mentioned the following growth catalysts:
- Stratasys’ vertical solution strategy, which is expected to commence by end of 2017 and begin to yield results by end-2017 and into 2018.
- Increasing consumables.
- The expected launch of the company’s recently announced production platforms in 2018.
The company indicated that the overall prototyping market was just ~20–25 percent penetrated by 3DP and had “attractive opportunity remaining,” Baruah stated.
The analyst maintains a Hold rating on Stratasys.
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