UPDATE: Jefferies Initiates Coverage on ExOne Co. with Buy Rating, $72 PT as Best Early Play on Mass Manufacturing Ramp

In a report published Wednesday, Jefferies analyst Peter Misek initiated coverage on

with a Buy rating and $72.00 price target. In the report, Jefferies noted, “ExOne is well positioned for the near-term mass manufacturing opportunity in aerospace followed by the auto mass manufacturing opportunity. Making direct parts (or castings for casts as the casting is destroyed in the process) is the big long-term opportunity for 3D printing. Wohlers notes that the ratio of prototypes to production parts is often 1:1000 or much greater. While 3D printers will need further productivity gains to penetrate mass manufacturing, the TAM is orders of magnitude higher. ExOne and voxeljet are the two pure plays on powder bed binder printers (3D Systems also is a major player in the space is mainly in the low-end and mid-range vs. >$1M ASPs for ExOne and voxeljet). Powder bed binder printers have the advantages of speed, large build bed, and the ability to work with metal. voxeljet currently focuses more on plastics while ExOne focuses on sand castings; direct metal parts are still in ramp phase for both. We prefer ExOne due to its lower valuation and its lead in sand casting for metal parts. We think ExOne is seeing early traction with its sand casting process at auto and aerospace customers (most notably Ford, BMW, and Sikorsky) and could transition to making more mass manufactured direct metal parts over time.” ExOne Co. closed on Tuesday at $55.67.