3D System's Underperform Rating: What It Means For The 3D Printing Industry

Analysts at Longbow Research initiated coverage on 3D Systems Corporation DDD, with an Underperform rating on Wednesday, December 10.

Analyst Joe Wittine set a price target of $25.00, implying a significant downside from current stock prices. He argued that the company faces execution problems and has “consistently over-promised and under-delivered.”

Following the news of this rating, the stock market punished 3D Systems, sending its stock down 4.76 percent on Wednesday, December 10, taking the stock’s year-to-date loss to 62.1 percent.

However, many other research firms seem to disagree with Longbow. For instance, Jefferies rated 3D Systems as a Buy in late-November, setting a price target of $42.00, while Imperial Capital gave it an Outperform rating, with a target price of $42.00, as well.

As there seems to be plenty of discussion regarding 3D Systems’ future, the 3D printing industry clearly deserves a second glance.

The Industry

Quite recently, Jason North of Jefferies

commented

on the 3D printing industry after he attended Euromold, the largest

3D printing industry

conference in the world. “The entire industry is gaining momentum in metal 3D printing, but is experiencing ‘limited visibility’ into SLS speed improvements.”

Comparative Point: Stratasys

Stratasys, Ltd. SSYS, another prevalent stock in the 3D printing industry, also saw Longbow initiate coverage on Wednesday, December 10. Nonetheless, analyst Joe Wittine was somewhat more bullish on this company, and gave it a Neutral rating.

Other analyst firms seem more confident: Brean Capital and Canaccord Genuity issued Buy recommendations in November, setting price targets of $125.00 and $140.00, respectively. Both these targets imply a considerable upside potential.